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European Central Bank (ECB) announced on October 26 that it would maintain interest rates at the current level. It was stated that the effects of previous interest rate increases continued to strongly reflect on the financing conditions. Officials also made statements regarding the Pandemic Emergency Purchase Program (PEPP), and according to this, it was announced that principal repayments would be reinvested by the end of 2024 at the latest.
ECB, in a period where data indicating the continuation of economic contraction in the European Union increased, refrained from raising interest rates for the first time in 15 months on October 26. The central bank continued to keep the benchmark interest rate in the 20 countries that use the Euro, the fiat currency, at the highest level since the currency was launched in 1999, which is 4%. The following statements were included in the announcements made by the central bank:
<blockquote>
 “High inflation is still expected to persist for a very long time, and domestic price pressures continue to remain strong. At the same time, inflation has decreased significantly in September, and most of the measures underlying inflation have continued to ease.”
</blockquote>
The decision to pause the interest rate hike, which came after 10 consecutive interest rate hikes, followed a data indicating that the decline in inflation continued and economic activities slowed down further in the region. An survey conducted among companies operating in the manufacturing and service sectors in the Eurozone on October 24 indicated a sharp decline in production along with weakening demand.
<img decoding="async" class="aligncenter wp-image-89573 size-full" src="https://coin-turk.com/wp-content/uploads/2020/05/abnin-750-milyar-euroluk-tesvik-paketi-btcyi-nasil-etkiler.jpg" alt="" width="1200" height="675">
<h2 id="pmi-data-indicates-recession">PMI Data Indicates Recession</h2>
According to the Purchasing Managers’ Index (PMI), companies have made employment cuts indicating the first decrease in personnel since the Covid-19 quarantine period at the beginning of 2021. The index, which was 47.2 in September, fell to 46.5 in October, reaching the lowest level in the past 35 months. Having this index below 50 indicates a contraction in <a href="https://newslinker.co/category/finance/" data-wpel-link="exclude" rel="noopener noreferrer nofollow">market</a> conditions.
Cyrus de la Rubia, Chief Economist at Hamburg Commercial Bank, who collaborated with S&amp;P Global to analyze PMI data, made the following comment on these data:
<blockquote>
 “Things are going from bad to worse in the Eurozone. We would not be caught unprepared to see a mild recession in the Eurozone in the second half of this year.”
</blockquote>
The survey of lenders published by the ECB on October 24 reveals that the demand for business loans and mortgage loans continued to decline sharply in the third quarter of the year, exceeding the expectations of banks. The report also stated that banks continued to tighten credit standards in all credit categories. Continue Reading: <a href="https://en.coin-turk.com/unexpected-decision-from-ecb/" data-wpel-link="internal" rel="noopener noreferrer nofollow">https://en.coin-turk.com/unexpected-decision-from-ecb/</a>

Unexpected Decision from ECB

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