EBC Loans Banks Lower Amount Than Expected and Strengthens Market

ECB loans less to banks and eruo strengthens.

ECB loans less to banks and eruo strengthens.

The Euro and stock markets were steady as the European Central Bank (ECB) loaned banks £107.7 billion which was below the expected high amount by over £2 billion. 

This level of lending was viewed by economists as a test of the bank sector’s health.  With the news the euro rose nearly a cent against the sterling.

According to the ECB 171 banks borrowed funds at a flat rate of 1 per cent.  Banks in Greece, Spain, and Portugal have become more increasingly dependent on the ECB due to failing economies.  Though the £107.7 billion was less than what had been projected it was still the highest ever borrowed in the three-month auction.  Had the demand for funds been higher it would have been seen as a warning since the ECB charges a higher interest rate as compared to market rates. 

The FTSE 100 was showing a 18.21 per cent increase at 4,932.43 as the day neared closing.

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