ECB Leaves Interest Rates Unchanged; Gold Reaction Muted
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(Kitco News) - Gold moved little after the European Central Bank left interest rates unchangedThursday and said it was continuing its asset-purchase program.
The Governing Council left the interest rate on the mainrefinancing operations and rates on the marginal lending facility and thedeposit facility at 0.0%, 0.25% and minus 0.40%, respectively.
“The Governing Council expects the key ECB interest rates to remainat their present levels for an extended period of time, and well past thehorizon of the net asset purchases,” said a prepared statement from the ECB.
Asof 7:50 a.m. EST, Comex April gold was trading down $1.10 to $1,326.50 anounce. The metal was at $1,325.30 a minute prior to the ECB announcement.
Marketswere watching to see if policymakers would take tentative steps toward startingto exit from their 2.55 trillion-euro asset-purchase program referred to asquantitative easing.
The Governing Council “confirms that the net asset purchases, atthe current monthly pace of ?,?30 billion, are intended to run until the end ofSeptember 2018, or beyond, if necessary, and in any case until the GoverningCouncil sees a sustained adjustment in the path of inflation consistent withits inflation aim,” the ECB statement said.
“The Eurosystem will reinvest the principal payments frommaturing securities purchased under the asset purchase program for an extendedperiod of time after the end of its net asset purchases, and in any case for aslong as necessary. This will contribute both to favorable liquidity conditionsand to an appropriate monetary policy stance.”
ECBPresident Mario Draghi is scheduled to hold a news conference later thismorning.
By Allen SykoraFor Kitco News
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