PRESS RELEASE

Decisions on ECB interest rates

7 January 1999

At today's meeting, the Governing Council of the ECB reviewed the monetary, financial and economic situation in the euro area against the background of its stability-oriented monetary policy strategy. Taking into account the latest economic developments, the Governing Council confirmed its earlier assessment of the outlook for price stability. The Governing Council therefore decided that for the two main refinancing operations to be announced on 11 January 1999 and 18 January 1999 the same conditions will apply as for the first such operation, which was settled today, i.e. they will be fixed rate tenders conducted at an interest rate of 3.0%. The Governing Council confirmed its intention to maintain the main refinancing rate at this level for the foreseeable future.

In addition, the Governing Council recalled that the marginal lending rate and the deposit rate were set at levels of 3.25% and 2.75%, respectively, for the period from 4 to 21 January 1999. The Governing Council confirmed its intention to terminate this transitional measure following its next meeting on 21 January 1999.

Finally, the Governing Council recalled the decision taken at its meeting on 22 December 1998 that the first longer-term refinancing operation, which will be announced on 12 January 1999 and settled on 14 January 1999, will be conducted as a variable rate tender, using the single rate allotment procedure.

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