Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.
ECB definition
What is the meaning of ECB?
ECB stands for the European Central Bank, which is the organisation responsible for the monetary policy in the eurozone. Unlike many other central banks, which only govern a single country, the ECB coordinates monetary policy for all the countries that have adopted the euro.
Learn more about the European Central Bank (ECB)
Discover when the next meeting is, and how the ECB can affect interest rates.
What does the ECB do?
The ECB works with national central banks within the eurozone to manage inflation levels and ensure the overall stability of the euro.
The decision-making body of the ECB is the governing council, which is made up of the governors of the central banks of the eurozone countries, alongside an executive board of six ECB personnel – including the president and vice-president of the ECB – and economists.
The governing council has overall responsibility for the formulation of monetary policy within the eurozone, including any decisions relating to interest rates, central bank currency reserves and the establishment of guidelines to allow these decisions to be implemented.
Three of the most important interest rate decisions taken by the governing council are:
- The main refinancing operations – the rate banks pay when they borrow money from the ECB for one week. The bank will need to provide collateral to guarantee repayment of the loan
- The marginal lending facility – the interest rate banks pay when they borrow from the ECB overnight. The bank will need to provide collateral to guarantee repayment of the loan
- The deposit facility – the interest that banks receive for depositing money with the ECB overnight. The ECB currently has a negative deposit facility rate, meaning that banks will have to pay the ECB to deposit money with it
Why are ECB decisions important for traders?
ECB decisions are important to traders because any announcements that might change monetary policy could have either a beneficial or adverse effect on the value of the euro and euro-denominated assets in the financial markets.
Build your trading knowledge
Discover how to trade with IG Academy, using our series of interactive courses, webinars and seminars.
Help and support
Get answers about your account or our services.
Interested in opening an account with us? Call 0800 195 3100 or send an email to newaccountenquiries.uk@ig.com.
We’re available from 8am to 6pm (UK time), Monday to Friday
Want to check on your application’s progress? Email us at newaccounts.uk@ig.com.
