![]() The ensuing normalisation of financing conditions, in turn, will exert downward pressure on inflation, contributing to restoring price stability over the medium term. ![]() ![]() The recalibration of the TLTRO III terms and conditions will contribute to the normalisation of bank funding costs. In view of the current inflationary developments and outlook, it is necessary to adapt certain parameters of TLTRO III to reinforce the transmission of our policy rates to bank lending conditions so that TLTRO III contributes to the transmission of the monetary policy stance needed to ensure the timely return of inflation to the ECB’s 2% medium-term target. The Governing Council of the European Central Bank (ECB) today decided to recalibrate the conditions of the third series of targeted longer-term refinancing operations (TLTRO III) as part of the monetary policy measures adopted to restore price stability over the medium term. Modification accompanied by three additional voluntary early repayment dates introduced for banks wishing to terminate or reduce borrowings before maturity.Existing interest rate calculation maintained for period up to 22 November 2022.From 23 November 2022, interest rate on all remaining TLTRO III operations to be indexed to average applicable key ECB interest rates from that date onward.Recalibration will help address unexpected and extraordinary inflation increases by reinforcing transmission of policy rates to bank lending conditions.ECB recalibrates third series of targeted longer-term refinancing operations (TLTRO III) to ensure consistency with broader monetary policy normalisation process.
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