ECB Holds Rates Steady, Announces Strategic Policy Review

The European Central Bank (ECB) has maintained its main refinancing rate at 0% and the deposit facility rate at -0.5%, a decision anticipated by the market. The ECB plans to keep rates at current or lower levels until inflation approaches its target. Inflation expectations for the next 5 to 10 years are around 1.3%, below the ECB's 2% target. The ECB is conducting its first strategic policy review since 2003, taking advantage of stable manufacturing data. Market reactions have been minimal, with the euro slightly weaker against the dollar and two-year yields remaining flat.

What significant review is the ECB announcing, and when was the last one conducted?

What has been the market response to the ECB's recent announcements?