ECB Restarts QE, Lowers Deposit Facility Rate to -0.5%

The video discusses the European Central Bank's (ECB) recent monetary policy decisions, including a 10 basis point interest rate cut and the restart of quantitative easing (QE) with a €20 billion monthly bond purchase starting November 1st. The ECB's actions were less aggressive than market expectations, which anticipated larger QE and earlier implementation. The impact of these decisions on banks, particularly the cost of negative interest rates on excess reserves, is also analyzed.

What was the market's expectation for the basis point cut, and what was the actual decision?

• 20 basis points expected, 10 basis points cut

• 10 basis points expected, 30 basis points cut

• 10 basis points expected, 20 basis points cut

• 30 basis points expected, 10 basis points cut

What is the monthly amount of debt the ECB plans to purchase starting November 1st?

• €10 billion

• €20 billion

• €30 billion

• €40 billion

How does the ECB's QE plan compare to Bloomberg's expectations?

• It is larger but starts later

• It is larger and starts earlier

• It is smaller and starts later

• It is the same size but starts later

What is the estimated annual financial impact of the negative deposit rate on European banks?

• €7 billion

• €10 billion

• €12 billion

• €5 billion

What percentage range have analysts suggested for the tiering system?

• 35% to 50%

• 50% to 60%

• 25% to 35%

• 10% to 20%