ECB Press Conference Aftermath

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On Thursday, The European Central Bank Cuts its refinancing rate by 25 Basis points to 0.5%, which is the first rate cut since July 2012. And also cut the interest rate on the marginal lending facility by 50 basis points to 1%. The ECB didn’t announce measures to support economy head-on. Mario Draghi, the President of the European Central Bank, stated “Our monetary policy stance will remain accommodative for as long as is needed,”

The ECB stated that it will stay on its main refinancing operation at least till July 2014.  “fixed rate full allotment” the name of the operations grant banks under stress an access to unlimited ECB easy monetary on a fixed rate.

It was expected to cut the rate by a 25 point  basis (0.5%). After the data showed this week lower than expected inflation and recorded high unemployment for the euro-zone.

June gold delivery increased $18.70 (1.3%) to $1,465 an ounce of gold, double what it had been in Asia and earlier European trading hours on the Comex division of the New York Mercantile Exchange.

The euro dropped after the ECB cuts, euro in the recent trade bought $1.3083 compared to $1.3202, during the press conference was held. While the USD made a slight improvement on Thursday. The U.S. stocks opened higher on Thursday after the ECB cuts. The Dow Jones Industrial Average jumped 44.46 points to 14,745.41, the Nasdaq Composite gained 11.11 points to 3,310.23 and the S&P 500 index rose by 4.54 points to 1,587.24.