The European Central Bank has left interest rates unchanged at record lows, as expected, and said they would stay on hold for at least the rest of this year. The ECB also announced that they will unveil fresh refinancing operations (TLTRO III) to stimulate the Eurozone’s faltering economy.
The Bank of Canada left its key interest rate unchanged at 1.75 percent and pointed to increased uncertainty about the timing of future rate hikes following the economy’s abrupt deceleration in late 2018. The central bank also acknowledged that they expect a bleaker economic performance in the months ahead.
The Organization for Economic Cooperation and Development cut its forecast for 2019 global economic growth to 3.3% from its November forecast of 3.5% and added that the global economy is facing increasingly serious headwinds and a sharper slowdown in any of the major regions could derail activity worldwide, especially if it spills over to financial markets.
New York Federal Reserve President John Williams said that the central bank can afford to be flexible on raising interest rates amid ongoing US economic uncertainty and US interest rates are now close to his estimate for neutral, the rate which neither stimulates nor slows the economy.