The European Central Bank intensified its response to the coronavirus crisis by cutting the cost of funding for banks, while urging politicians to provide more fiscal support.
Hours after data showed the worst three-month contraction in a quarter-century of statistics, president Christine Lagarde warned that the euro-area economy could shrink as much as 12 per cent this year.
“Continued and ambitious efforts are needed, notably through joint and coordinated policy action, to guard against downside risks and underpin the recovery,” she said in a virtual press conference on Thursday. “An ambitious and coordinated fiscal stance is critical, in view of the sharp contraction.”
She spoke after policy makers reduced the cost of their emergency loan programme for banks, and unveiled a further facility to inject liquidity into the outbreak-stricken economy.
The ECB said the lowest interest rate on a programme that gives banks incentives to lend to companies and households will fall to 50 basis points below the deposit rate, currently at -0.5 per cent. Interest on the new, non-targeted facility will be 0.25 per cent below the main refinancing rate that presently is zero.
Officials kept their pandemic purchase program at €750 billion euros (Dh2.9 trillion), which together with earlier programmes, means it will buy more than €1tn of debt through the end of this year.
Most economists predict the ECB will bump that up later this year. Ms Lagarde said the central bank is “fully prepared” to increase or extend the programme if needed.
Bond investors largely signaled satisfaction with the move, with Italian yields falling after initially briefly jumping.
“For today, it’s enough,” said Carsten Brzeski, an economist at ING in Frankfurt. “So much has been announced in the past six weeks.”
Lockdowns to curb the spread of the coronavirus have sent unemployment soaring across the region and burdened the currency area’s economies with massive costs.
Figures revealed earlier on Thursday showed European output shrank the most on record during the first quarter, a period only partially blighted by coronavirus lockdowns. Countries such as Italy, Spain and France, with limited room to spend their way out of the crisis, saw contractions of around 5 per cent.
With more pain to come, demands by the euro area’s most vulnerable nations for a joint fiscal response will only grow louder. So far, most government action has been at the national level.
Leaders have asked the European Commission to come up with a broader proposal by May 6, though its unclear how to resolve disagreements on whether aid should take the form of grants or loans. Likewise, Germany and the Netherlands have led opposition to joint debt over fears they’ll end up with much of the bill.
The squabbling has unnerved investors, who fret that heavily indebted nations such as Italy will be tipped into a deeper crisis. The country’s credit rating was unexpectedly cut by Fitch this week.
An ambitious and coordinated fiscal stance is critical, in view of the sharp contraction
The response contrasts with other major economies where fiscal support has been stronger. Federal Reserve Chairman Jerome Powell warned on Wednesday, after maintaining his institution’s own emergency settings, that this is “not the time” to worry about the US debt burden.
Michael Pyle, global chief investment strategist at BlackRock, finds the contrast telling. He said the ECB’s move on Thursday only amount to “incremental steps in the right direction".
“When we compare what we’re seeing out of the Fed and US policy makers more broadly, the scale in response is much different,” he told Bloomberg Television. “We’re going to need to see quite a bit more, looking ahead.”
The ECB already eased the terms of its bank-lending programme at its March policy meeting. It also recently loosened standards on the collateral it’ll accept for refinancing.
Electoral College Victory
Trump has so far secured 295 Electoral College votes, according to the Associated Press, exceeding the 270 needed to win. Only Nevada and Arizona remain to be called, and both swing states are leaning Republican. Trump swept all five remaining swing states, North Carolina, Georgia, Pennsylvania, Michigan and Wisconsin, sealing his path to victory and giving him a strong mandate.
Popular Vote Tally
The count is ongoing, but Trump currently leads with nearly 51 per cent of the popular vote to Harris’s 47.6 per cent. Trump has over 72.2 million votes, while Harris trails with approximately 67.4 million.
Indoor cricket in a nutshell
Indoor cricket in a nutshell
Indoor Cricket World Cup - Sept 16-20, Insportz, Dubai
16 Indoor cricket matches are 16 overs per side
8 There are eight players per team
9 There have been nine Indoor Cricket World Cups for men. Australia have won every one.
5 Five runs are deducted from the score when a wickets falls
4 Batsmen bat in pairs, facing four overs per partnership
Scoring In indoor cricket, runs are scored by way of both physical and bonus runs. Physical runs are scored by both batsmen completing a run from one crease to the other. Bonus runs are scored when the ball hits a net in different zones, but only when at least one physical run is score.
Zones
A Front net, behind the striker and wicketkeeper: 0 runs
B Side nets, between the striker and halfway down the pitch: 1 run
C Side nets between halfway and the bowlers end: 2 runs
D Back net: 4 runs on the bounce, 6 runs on the full
COMPANY%20PROFILE
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UAE currency: the story behind the money in your pockets
Grand slam winners since July 2003
Who has won major titles since Wimbledon 2003 when Roger Federer won his first grand slam
Roger Federer 19 (8 Wimbledon, 5 Australian Open, 5 US Open, 1 French Open)
Rafael Nadal 16 (10 French Open, 3 US Open, 2 Wimbledon, 1 Australian Open)
Novak Djokovic 12 (6 Australian Open, 3 Wimbledon, 2 US Open, 1 French Open)
Andy Murray 3 (2 Wimbledon, 1 US Open)
Stan Wawrinka 3 (1 Australian Open, 1 French Open, 1 US Open)
Andy Roddick 1 (1 US Open)
Gaston Gaudio 1 (1 French Open)
Marat Safin 1 (1 Australian Open)
Juan Martin del Potro 1 (1 US Open)
Marin Cilic 1 (1 US Open)
Muslim Council of Elders condemns terrorism on religious sites
The Muslim Council of Elders has strongly condemned the criminal attacks on religious sites in Britain.
It firmly rejected “acts of terrorism, which constitute a flagrant violation of the sanctity of houses of worship”.
“Attacking places of worship is a form of terrorism and extremism that threatens peace and stability within societies,” it said.
The council also warned against the rise of hate speech, racism, extremism and Islamophobia. It urged the international community to join efforts to promote tolerance and peaceful coexistence.
Company%20profile
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57%20Seconds
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The alternatives
• Founded in 2014, Telr is a payment aggregator and gateway with an office in Silicon Oasis. It’s e-commerce entry plan costs Dh349 monthly (plus VAT). QR codes direct customers to an online payment page and merchants can generate payments through messaging apps.
• Business Bay’s Pallapay claims 40,000-plus active merchants who can invoice customers and receive payment by card. Fees range from 1.99 per cent plus Dh1 per transaction depending on payment method and location, such as online or via UAE mobile.
• Tap started in May 2013 in Kuwait, allowing Middle East businesses to bill, accept, receive and make payments online “easier, faster and smoother” via goSell and goCollect. It supports more than 10,000 merchants. Monthly fees range from US$65-100, plus card charges of 2.75-3.75 per cent and Dh1.2 per sale.
• 2checkout’s “all-in-one payment gateway and merchant account” accepts payments in 200-plus markets for 2.4-3.9 per cent, plus a Dh1.2-Dh1.8 currency conversion charge. The US provider processes online shop and mobile transactions and has 17,000-plus active digital commerce users.
• PayPal is probably the best-known online goods payment method - usually used for eBay purchases - but can be used to receive funds, providing everyone’s signed up. Costs from 2.9 per cent plus Dh1.2 per transaction.
The specs
- Engine: 3.9-litre twin-turbo V8
- Power: 640hp
- Torque: 760nm
- On sale: 2026
- Price: Not announced yet
