The Euro Area Ushers In The "Negative Interest Rate Era", Which Has Limited Impact On A Shares.

< p > the European Central Bank announced yesterday that the benchmark refinancing interest rate will be reduced by 10 basis points to 0.15%, and the overnight interest rate will be reduced to -0.1% from the previous zero. The euro zone will usher in a negative interest rate era. The European Central Bank has become the world's first central bank to implement "a href=" //www.sjfzxm.com/news/index_c.asp "minus interest rate /a" policy. < /p >
< p > financial analysts believe that the ECB's small interest rate cuts are mainly aimed at dealing with the risk of deflation in the euro area. Last November, the euro area inflation rate continued to decline, which led to the ECB unexpectedly cut interest rates, when the a href= "//www.sjfzxm.com/news/index_c.asp" > euro zone < /a > inflation rate was 0.9%. < /p >
In March, the euro area inflation rate continued to decline to 0.5%, the lowest since November 2009. In April, affected by food and energy prices, the euro zone a href= "//www.sjfzxm.com/news/index_c.asp" > inflation rate < /a > rebounded to 0.7%. < /p >
< p > however, in May, the euro area inflation rate dropped to 0.5% again, indicating that the risk of deflation increased further. < /p >
< p > the new interest rate decision means that commercial banks will have to pay for their funds deposited in the European Central Bank. The ECB's move will stimulate banks to put more capital into the market, thereby increasing the money supply, encouraging banks to stop hoarding capital and lending to consumers and businesses, thereby boosting the euro area economy and preventing deflation. < /p >
< p > but some economists warn that this may lead to "unpredictable and unexpected consequences". < /p >
< p > these consequences include banks passing on the new cost of the ECB savings to their customers, and negative earnings from deposits may also encourage banks to invest in riskier assets for higher returns, thereby promoting new asset bubbles and downside risks. < /p >
In addition, banks are likely to increase the weight of buying government bonds. If financial shocks happen again, the degree of interdependence and mutual involvement between banks and governments will be further deepened. P < /p >
< p > the euro area has officially entered the era of negative interest rate, which has an impact on the A share? < /p >
< p > 1 and the appreciation of the US dollar, there may be a short-term acceleration in the downward trend of RMB. < /p >
< p > 2, will China follow up? The impact of the European Central Bank's interest rate cut on the domestic market is only a temporary psychological level. It is almost impossible for domestic monetary policy to follow European interest rates. < /p >
< p > 3, which has limited impact on the stock market. The linkage between China's stock market and European stock market is not strong, which basically has no effect on A shares. < /p >