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The European Central Bank (ECB) avoided raising interest rates for the first time in 15 months on October 26, amid increasing data indicating ongoing economic contraction in the European Union. The ECB continued to keep the benchmark interest rate for the 20 countries that use the Euro, the fiat currency, at its highest level since its introduction in 1999, which is 4%. The central bank made the following statements:
<blockquote>
 “Inflation is still expected to remain very high for a long time, and domestic price pressures continue to be strong. At the same time, inflation decreased significantly in September, and most of the measures underlying inflation continue to loosen.”
</blockquote>
The decision to pause the interest rate hike, following 10 consecutive rate increases, came after a data indicating a continued decline in inflation and a sharp drop in economic activity in the region. An index published among companies operating in the manufacturing and service sectors in the Eurozone on October 24 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 resorted to employment cuts, indicating the first decrease in personnel since the Covid-19 quarantine period in early 2021. The index, which was 47.2 in September, dropped to 46.5 in October, reaching its lowest level in the past 35 months. A value below 50 in this index 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, the chief economist at Hamburg Commercial Bank, who collaborated with S&amp;P Global to analyze the PMI data, made the following comment:
<blockquote>
 “Things are going from bad to worse in the Eurozone. Seeing a slight recession in the Eurozone in the second half of this year should not catch us unprepared.”
</blockquote>
The credit lending survey published by the ECB on October 24 revealed that demand for business loans and mortgage loans continued to decline sharply in the third quarter of the year, more than what banks had expected. The report also stated that banks continue to tighten credit standards in all loan categories. Continue Reading: <a href="https://en.coin-turk.com/surprising-decision-from-the-european-central-bank/" data-wpel-link="internal" rel="noopener noreferrer nofollow">https://en.coin-turk.com/surprising-decision-from-the-european-central-bank/</a>

Surprising Decision from the European Central Bank

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