Mubasher: The European Central Bank (ECB) slashed the interest rate on the deposit facility on Thursday, while it kept the rates on the main refinancing operations and the marginal lending facility unchanged.

The ECB slashed rate on the deposit facility by 10 basis points (bps) to a record low -0.50%, while keeping rates on the main refinancing operations and the marginal lending facility at 0.00% and 0.25%, respectively.

Moreover, the central decided to re-introduce a quantitative easing (QE) programme as from 1 November, at a monthly pace of EUR 20 billion ($22.04 billion).

“The Governing Council expects [bond purchases] to run for as long as necessary to reinforce the accommodative impact of its policy rates, and to end shortly before it starts raising the key ECB interest rates,” the ECB said.

The main ECB interest rates are expected to remain unchanged to remain at their present or lower levels, until the inflation rate reaches a level “close to, but below 2%.”

The ECB’s decision came as Germany, Europe’s biggest economy, is on the brink of a recession, and as the global trade conflict was dampening domestic confidence.

By 12:11 pm GMT, the EUR/USD pair fell by 0.43% to $1.0963.