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European Central Bank extends asset purchases to March 2017 and cuts interest rates to new record lows

Mario Draghi / Getty

The European Central Bank (ECB) has ramped up its asset purchase programme to the tune of €360bn (£257bn), its president Mario Draghi announced today.

The programme will now run until the end of March 2017 instead of September 2016 as initially planned, but will stay at a rate of €60bn. It will take the value of the programme up to €1.5 trillion from €1.1 trillion. The ECB also added regional government bonds to the list of eligible assets it can buy, so it can now buy the bonds of Paris or Milan local governments.

Members of the ECB’s governing council also cut the central bank’s deposit rate to minus 0.3 per cent from minus 0.2 per cent today.

The main refinancing rate, which applies to short term loans to banks,  was kept at 0.05 per cent.

The euro immediately shot up to a value of 71.270p from 70.599p. The currency move suggests markets were disappointed, with many analysts expecting the deposit rate to be cut to minus 0.4 per cent.

Read the full story at City A.M, by Chris Papadopoullos

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