The European Central Bank left interest rates on hold Thursday in a widely-anticipated decision and reiterated that it will remain unchanged at least through the summer of 2019.
The euro zone monetary authority left interest rates unchanged at zero, where they have remained since March 2016.
Despite the lack of surprise in Thursday’s decision, investors will pay close attention to the ECB press conference with President Mario Draghi as they look for any shift in the central bank’s outlook.
As the euro area grapples with global trade conflicts, Italian budget issues and messy Brexit negotiations, there is a small possibility that the ECB may see risks shifting from balanced to the downside.
“We don't think it'll be prepared to do this just yet,” Morgan Stanley economists said.
Although these experts do see growing risks, they believe that a relatively-robust pace of domestic expansion, along with potential upside risks from fiscal policy, are still sufficient to keep the recent balance.
With Thursday's decision, the ECB's deposit rate, currently its primary interest rate tool, remains at -0.40%, while the main refinancing rate, which determines the cost of credit in the economy, stayed at 0.0%.
The ECB is likely to reiterate that it expects its asset purchase program to end in December after halving it to €15 billion per month starting in October.
The euro zone monetary authority announced plans to wind up its massive bond purchasing stimulus program at its June meeting.
In addition, the ECB's latest meeting minutes noted that trade tensions could lead to a decline in confidence throughout the global economy, beyond any direct effects from trade tariffs.
