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The European Central Bank (ECB) announced on October 26th that it would maintain its interest rates, stating that the previous interest rate hikes continue to strongly impact financing conditions. Officials also provided updates on the Pandemic Emergency Purchase Program (PEEP), revealing plans to reinvest principal payments by the end of 2024.
<h2 id="unexpected-decision-from-ecb">Unexpected Decision from ECB</h2>
In a period where data indicating the continuation of economic contraction in the European Union has increased, the European Central Bank (ECB) decided to refrain from increasing interest rates for the first time in 15 months on October 26th. The ECB maintained the benchmark interest rate for the Euro currency, which has been at its highest level of 4% since its introduction in 1999. The following statement was included in the central bank’s announcement:
<blockquote>
 “Inflation is still expected to remain significantly high for a prolonged period, and domestic price pressures continue to remain strong. At the same time, inflation has significantly decreased in September, and most measures underlying inflation have continued to ease.”
</blockquote>
The decision to pause the interest rate hike, following ten consecutive rate increases, came after a data indicating a further decline in inflation and a sharp decrease in economic activities in the region. An survey published among companies operating in the manufacturing and service sectors in the Eurozone on October 24th indicated a decline in 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 in early 2021. The index decreased from 47.2 in September to 46.5 in October, reaching its lowest level in the past 35 months. An 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 the PMI data, commented:
<blockquote>
 “Things are going from bad to worse in the Eurozone. We should not be caught unprepared to see a mild recession in the Eurozone in the second half of this year.”
</blockquote>
The credit survey published by the ECB on October 24th reveals a sharp decline in demand for business loans and mortgage loans in the third quarter of the year, surpassing the expectations of banks. The report also stated that banks continue to tighten credit standards in all loan categories. Continue Reading: <a href="https://en.coin-turk.com/european-central-bank-keeps-interest-rates-unchanged-amid-economic-slowdown/" data-wpel-link="internal" rel="noopener noreferrer nofollow">https://en.coin-turk.com/european-central-bank-keeps-interest-rates-unchanged-amid-economic-slowdown/</a>

European Central Bank Keeps Interest Rates Unchanged Amid Economic Slowdown

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