April 30, 2020 |
• Interest rate on all targeted longer-term refinancing operations (TLTRO III) reduced by 25 basis points to -0.5% from June 2020 to June 2021
• For banks meeting the lending threshold of 0% introduced on 12 March 2020, the interest rate can be as low as -1%
• Start of the lending assessment period brought forward to 1 March 2020
The Governing Council of the European Central Bank (ECB) today decided on a number of modifications to the terms and conditions of its targeted longer-term refinancing operations (TLTRO III) in order to support further the provision of credit to households and firms in the face of the current economic disruption and heightened uncertainty.
For the period from 24 June 2020 to 23 June 2021 the interest rate on all TLTRO III operations will now be 50 basis points below the average rate applied in the Eurosystem’s main refinancing operations over the same period. The interest rate on the main refinancing operations is currently 0%. For counterparties whose eligible net lending reaches the lending performance threshold, the interest rate applied from 24 June 2020 to 23 June 2021 on all TLTRO III operations will be 50 basis points below the average interest rate on the deposit facility prevailing over the same period, and in any case not higher than -1%. The deposit facility rate is currently -0.5%.
The start of the period over which banks’ lending performance will be assessed in order to ascertain whether they qualify for this lower rate will be brought forward to 1 March 2020, from 1 April 2020, while the end of the assessment period will remain unchanged at 31 March 2021. This adjustment recognises the funding support that banks have already provided to firms in March at the start of the crisis related to the coronavirus (COVID-19) pandemic, in line with the aims of TLTRO III.
For banks that reach the lending threshold of 0% between 1 March 2020 and 31 March 2021, the most favourable conditions will be applied throughout the entire life of the operations. The interest rate applied before 24 June 2020 and after 23 June 2021 for these counterparties will be the average interest rate on the deposit facility over the life of the respective operation. For banks that do not reach the lending threshold of 0% between 1 March 2020 and 31 March 2021, the original TLTRO III interest rates and lending threshold, evaluated over the longer period of between 1 April 2019 and 31 March 2021, will apply. For these counterparties, in recognition of the challenging credit environment during the pandemic period, the lending threshold that they need to meet over this longer assessment period will be lowered to 1.15%, from 2.5%. In any case, during the period from 24 June 2020 to 23 June 2021 the rate for these banks will not be higher than 50 basis points below the average rate applied in the Eurosystem’s main refinancing operations over the same period.
The changes to TLTRO III will apply to all TLTRO III operations and will be implemented via amendments to the Decision of the ECB of 22 July 2019 on a third series of targeted longer-term refinancing operations (ECB/2019/21), as amended by the Decisions of the ECB of 12 September 2019 (ECB/2019/28) and 16 March 2020 (ECB/2020/13). The changes to the lending threshold, the reduction in the rates during the period from 24 June 2020 to 23 June 2021 and the bringing forward of the start date of the lending performance assessment period to 1 March 2020 will be set forth in a third amendment that will be published shortly on the ECB’s website and subsequently in the Official Journal of the European Union.
Compliments of the European Central Bank.

April 30, 2020 |
At today’s meeting the Governing Council of the ECB took the following monetary policy decisions:
(1) The conditions on the targeted longer-term refinancing operations (TLTRO III) have been further eased. Specifically, the Governing Council decided to reduce the interest rate on TLTRO III operations during the period from June 2020 to June 2021 to 50 basis points below the average interest rate on the Eurosystem’s main refinancing operations prevailing over the same period. Moreover, for counterparties whose eligible net lending reaches the lending performance threshold, the interest rate over the period from June 2020 to June 2021 will now be 50 basis points below the average deposit facility rate prevailing over the same period.
(2) A new series of non-targeted pandemic emergency longer-term refinancing operations (PELTROs) will be conducted to support liquidity conditions in the euro area financial system and contribute to preserving the smooth functioning of money markets by providing an effective liquidity backstop. The PELTROs consist of seven additional refinancing operations commencing in May 2020 and maturing in a staggered sequence between July and September 2021 in line with the duration of the collateral easing measures. They will be carried out as fixed rate tender procedures with full allotment, with an interest rate that is 25 basis points below the average rate on the main refinancing operations prevailing over the life of each PELTRO.
(3) Since the end of March, purchases have been conducted under the Governing Council’s new pandemic emergency purchase programme (PEPP), which has an overall envelope of €750 billion, to ease the overall monetary policy stance and to counter the severe risks to the monetary policy transmission mechanism and the outlook for the euro area posed by the coronavirus pandemic. These purchases will continue to be conducted in a flexible manner over time, across asset classes and among jurisdictions. The Governing Council will conduct net asset purchases under the PEPP until it judges that the coronavirus crisis phase is over, but in any case until the end of this year.
(4) Moreover, net purchases under the asset purchase programme (APP) will continue at a monthly pace of €20 billion, together with the purchases under the additional €120 billion temporary envelope until the end of the year. The Governing Council continues to expect monthly net asset purchases under the APP to run for as long as necessary to reinforce the accommodative impact of its policy rates, and to end shortly before it starts raising the key ECB interest rates.
(5) Reinvestments of the principal payments from maturing securities purchased under the APP will continue, in full, for an extended period of time past the date when the Governing Council starts raising the key ECB interest rates, and in any case for as long as necessary to maintain favourable liquidity conditions and an ample degree of monetary accommodation.
(6) The interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 0.00%, 0.25% and -0.50% respectively. The Governing Council expects the key ECB interest rates to remain at their present or lower levels until it has seen the inflation outlook robustly converge to a level sufficiently close to, but below, 2% within its projection horizon, and such convergence has been consistently reflected in underlying inflation dynamics.
The Governing Council is fully prepared to increase the size of the PEPP and adjust its composition, by as much as necessary and for as long as needed. In any case, it stands ready to adjust all of its instruments, as appropriate, to ensure that inflation moves towards its aim in a sustained manner, in line with its commitment to symmetry.
Compliments of the European Central Bank.

April 14, 2020
Introduction and key messages
The increasing spread of the coronavirus across countries has prompted many governments to introduce unprecedented measures to contain the epidemic. These are priority measures that are imposed by a sanitary situation, which leave little room for other options as health should remain the primary concern. These measures have led to many businesses being shut down temporarily, widespread restrictions on travel and mobility, financial market turmoil, an erosion of confidence and heighted uncertainty.
In a rapidly changing environment, it is extremely difficult to quantify the exact magnitude of the impact of these measures on GDP growth, but is clear that they imply sharp contractions in the level of output, household spending, corporate investment and international trade. This note provides illustrative estimates of the initial direct impact of shutdowns, based on an analysis of sectoral output and consumption patterns across countries and an assumption of common effects within each sector and spending category in all countries.
• This approach suggests that the initial direct impact of the shutdowns could be a decline in the level of output of between one-fifth to one-quarter in many economies, with consumers’ expenditure potentially dropping by around one-third.Changes of this magnitude would far outweigh anything experienced during the global financial crisis in 2008-09. This broad estimate only covers the initial direct impact in the sectors involved and does not take into account any additional indirect impacts that may arise.
These are only the initial impacts on the level of output. The implications for annual GDP growth will depend on many factors, including the magnitude and duration of national shutdowns, the extent of reduced demand for goods and services in other parts of the economy, and the speed at which significant fiscal and monetary policy support takes effect. Nonetheless, it is clear that the impact of the shutdowns will weaken short-term growth prospects substantially.
• The scale of the estimated decline in the level of output is such that it is equivalent to a decline in annual GDP growth of up to 2 percentage points for each month that strict containment measures continue. If the shutdown continued for three months, with no offsetting factors, annual GDP growth could be between 4-6 percentage points lower than it otherwise might have been.
These estimates are one approach to quantifying the initial impact of containment measures on activity, and do not utilise the full range of data that inform the projections of economic growth in the OECD Economic Outlook. However, their message of sharp initial declines in activity across countries following shutdowns and restrictions on mobility is very similar to that emerging from business surveys, high-frequency daily indicators, and the sharp output contraction observed already in China this year.
Considerable uncertainty remains about the duration and magnitude of confinement measures and the extent to which they may be implemented in a similar manner across countries. Even once they begin to be eased, the extent of any subsequent recovery in output will depend on the effectiveness of the policy actions taken to support workers and companies through the downturn and the extent to which confidence returns.
READ THE FULL REPORT HERE
Compliments of the OECD.

April 26, 2020 |
• Plan Will Be Implemented in Phases and Based on Regional Analysis and Determinations
• State Will Closely Monitor Hospitalization Rate and Public Health Impact During Each Phase of Re-Opening and Will Adjust Plan and Make Other Decisions Based on Those Indicators
• Confirms 5,902 Additional Coronavirus Cases in New York State – Bringing Statewide Total to 288,045; New Cases in 48 Counties
Amid the ongoing COVID-19 pandemic, Governor Andrew M. Cuomo today outlined a phased plan to re-open New York and re-imagine a new normal for the state starting with construction and manufacturing. The plan will be implemented in phases and will be based on regional analysis and determinations. Based on CDC recommendations, once a region experiences a 14-day decline in the hospitalization rate they may begin a phased re-opening. The State is closely monitoring the hospitalization rate, the infection rate and the number of positive antibody tests, as well as the overall public health impact, and will make adjustments to the plan and other decisions based on these indicators.
CONTINUE READING…
Compliments of the Office of the Governor of New York.

April 28, 2020 |
The Commission has today adopted a banking package to help facilitate bank lending to households and businesses throughout the European Union. The aim of this package is to ensure that banks can continue to lend money to support the economy and help mitigate the significant economic impact of the Coronavirus. It includes an Interpretative Communication on the EU’s accounting and prudential frameworks, as well as targeted “quick fix” amendments to EU banking rules.
The rules put in place following the financial crisis have ensured that banks in the EU are now more resilient and better prepared to deal with shocks to the economy. Today’s Communication recalls that EU rules allow banks and their supervisors to act in a flexible, but responsible, manner during economic crises to support citizens and firms, particularly small and medium-sized companies. Today’s Regulation also implements some targeted changes to maximise the capacity of credit institutions to lend and to absorb losses related to the Coronavirus pandemic, while still ensuring their continued resilience.
Valdis Dombrovskis, Executive Vice-President for an Economy that Works for People said: “We are supporting households and businesses as much as we can to deal with the economic fallout of the Coronavirus. The banking sector can do a lot to help here. We are using the full flexibility of the EU’s banking rules and proposing targeted legislative changes to enable banks to keep the liquidity taps turned on, so that households and companies can get the financing they need. I will soon also be launching roundtable discussions bringing together consumer and business groups with the financial sector so that we can address the most urgent needs of our citizens and companies.”
The Commission will engage with the European financial sector to explore how it can develop best practices that could further support citizens and businesses. The EU’s response to this crisis must be coordinated in order to avoid national fragmentation and to ensure a level playing field.
Targeted amendments to banking rules
The Commission proposed today a few targeted “quick fix” amendments to the EU’s banking prudential rules (the Capital Requirements Regulation) in order to maximise the ability of banks to lend and absorb losses related to Coronavirus. The Commission proposes exceptional temporary measures to alleviate the immediate impact of Coronavirus-related developments, by adapting the timeline of the application of international accounting standards on banks’ capital, by treating more favourably public guarantees granted during this crisis, by postponing the date of application of the leverage ratio buffer and by modifying the way of excluding certain exposures from the calculation of the leverage ratio. The Commission also proposes to advance the date of application of several agreed measures that incentivise banks to finance employees, SMEs and infrastructure projects.
Interpretative Communication
Today’s Communication confirms the recent statements on using flexibility within accounting and prudential rules, such as those made by the Basel Committee of Banking Supervision, the European Banking Authority (EBA) and the European Central Bank, amongst others. The Commission encourages banks and supervisory authorities to make use of the flexibility in the EU’s accounting and prudential frameworks. For example, the Communication confirms – and welcomes – the flexibility available in EU rules when it comes to public and private moratoria on loan repayments (EBA guidelines of 2 April). The Communication also highlights areas where banks are invited to act responsibly, for example by refraining from making dividend distributions to shareholders or adopting a conservative approach to the payment of variable remuneration. Today’s Communication also recalls how banks can help businesses and citizens through digital services, including contactless and digital payments.
Compliments of the European Commission.

April 24, 2020 |
The European Union is joining forces with global partners to kick-start a pledging effort – the Coronavirus Global Response – starting on 4 May 2020. The World Health Organization (WHO) and global health organisations have launched a joint call for action to develop fast and equitable access to safe, quality, effective and affordable diagnostics, therapeutics and vaccines against coronavirus.
To raise funds in support of this endeavour, the European Union and its partners will organise a worldwide pledging marathon. Countries and organisations around the world are invited to pledge to help reach the target of €7.5 billion in initial funding.
European Commission President von der Leyen said: “We need to bring the world, its leaders and people together against coronavirus. In just 10 days, we will launch a global pledging effort. A real marathon. Because beating coronavirus requires a global response and sustained actions on many fronts. We need to develop a vaccine, to produce it and deploy it to every corner of the world. And we need to make it available at affordable prices.”
Researchers and innovators around the world are working very hard to find solutions to save lives and protect our health. Starting on the 4th of May, the Commission will register pledges from countries and business foundations. On that day, the Commission will also announce the next milestones of a global campaign, which is to kick off an ongoing rolling replenishment.
The Commission is also inviting governments, business leaders, public figures philanthropists, artists and citizens to raise awareness about this global pledging effort. The funds collected will be channelled into three strands: diagnostics, treatments and vaccines.
The countdown to the start of marathon begins today, the first day of the 2020 World Immunisation Week organised by the United Nations. The theme this year is #VaccinesWork for All and the campaign will focus on how vaccines, as well as the people who develop, deliver and receive them, work to protect the health of everyone, everywhere.
Find out more about the effort and how to get involved on the Coronavirus Global Response website: europa.eu/global-response
Background
On 26 March, in an extraordinary meeting on the coronavirus outbreak, the G20 agreed to establish a global initiative on pandemic preparedness and response to “act as a universal, efficient, sustained funding and coordination platform to accelerate the development and delivery of vaccines, diagnostics and treatments.”
On 24 April, the WHO and an initial group of global health actors launched a landmark, global collaboration for the accelerated development, production and equitable global access to new COVID-19 essential health technologies. The group includes the Bill and Melinda Gates Foundation (BMGF), the Coalition for Epidemic Preparedness Innovations (CEPI), GAVI – the Vaccine Alliance – , the Global Fund, UNITAID, the Wellcome Trust and the World Bank. Together, they committed to the shared aim of equitable global access to innovative tools to fight the COVID-19 virus for all. Read the joint call to action here.
To respond to the joint call for action from health actors, the EU is joining forces with France, Germany, the United Kingdom, Norway and Saudi Arabia to host a pledging conference. This follows the announcement by President von der Leyen on 15 April that the Commission would organise an online pledging event to fund the development of a vaccine against COVID-19.
In parallel, the Commission is committing hundreds of millions of euros in research and innovation measures to develop vaccines, new treatments, diagnostic tests and medical systems to prevent the spread of the coronavirus.
Compliments of the European Commission.

READ MICHEL BARNIER’S FULL STATEMENT HERE
Compliments of the European Commission.

Main results
On 23 April 2020 EU leaders discussed progress on the various dimensions of the European response to the COVID-19 outbreak. It was the fourth video meeting of this kind.
• Conclusions by President Charles Michel after the video conference with members of the European Council on 23 April 2020
Lifting COVID-19 containment measures
Leaders welcomed a European roadmap towards lifting COVID-19 containment measures, presented by Presidents Michel and von der Leyen on 15 April.
“We all agreed that the health and safety of our citizens comes first. We also agreed to continue to follow the situation closely, in particular as we approach the holiday season, and to coordinate as much as possible to ensure a gradual and orderly lifting of restrictions.” – Charles Michel, President of the European Council
• Joint European Roadmap towards lifting COVID-19 containment measures
Roadmap for recovery
EU leaders also welcomed the Joint Roadmap for Recovery, which defines four key areas for action: single market, massive investment efforts, EU global action and better governance. It also sets out important principles, such as solidarity, cohesion and convergence.
• A roadmap for recovery
Safety nets
The heads of state or government endorsed the agreement of the Eurogroup on three safety nets for workers, businesses and sovereigns, amounting to a package worth 540 billion euro. They called for the package to be operational by 1 June 2020.
• Eurogroup report on the comprehensive economic policy response to the COVID-19 pandemic, press release, 9 April 2020
Recovery fund and MFF
They also agreed to work towards establishing a recovery fund. Leaders tasked the Commission to analyse the exact needs and to urgently come up with a proposal.
“This fund shall be of a sufficient magnitude, targeted towards the sectors and geographical parts of Europe most affected (…) We remain committed to giving the necessary impetus to work on the recovery fund as well as the MFF, so that a balanced agreement on both can be found as soon as possible.” – Charles Michel, President of the European Council
• COVID-19 coronavirus outbreak and the EU’s response (background information and timeline)
Illegal drilling in Cyprus
The illegal drilling activities by Turkey in Cyprus’ exclusive economic zone were raised by some member states. Leaders expressed their full solidarity with Cyprus and recalled and reaffirmed their previous conclusions on this issue.
Video meeting with Western Balkans
EU leaders also decided to hold a video conference with the Western Balkans on 6 May 2020.
Compliments of the European Council.

“On April 20, 2020, the Secretary of the Treasury and U.S. Customs and Border Protection (CBP) will be postponing for 90 calendar days the deadline for payment for the deposit of certain estimated duties, taxes, and fees for importers experiencing a significant financial hardship due to the coronavirus disease (COVID-19). This temporary postponement applies to formal entries of merchandise entered, or withdrawn from warehouse, for consumption (including entries for consumption from a Foreign Trade Zone) in March 2020 or April 2020. CBP will not return deposits of estimated duties, taxes, and fees that have already been paid….”
CONTINUE READING: COVID-19 – 90 Day Postponement of Paymentfor the Deposit of Certain Estimated Duties, Taxes, and Fees
Compliments of Fracht, USA. 

April 22, 2020 |
• ECB to grandfather until September 2021 eligibility of marketable assets used as collateral in Eurosystem credit operations falling below current minimum credit quality requirements
• Appropriate haircuts will apply for assets that fall below the Eurosystem minimum credit quality requirements
• Decision reinforces broader package of collateral easing measures adopted by the Governing Council on 7 April 2020, which will also remain in place until September 2021
• ECB may decide further measures, if needed, to continue ensuring the smooth transmission of its monetary policy in all jurisdictions of the euro area
The Governing Council of the European Central Bank (ECB) today adopted temporary measures to mitigate the effect on collateral availability of possible rating downgrades resulting from the economic fallout from the coronavirus (COVID-19) pandemic. The decision complements the broader collateral easing package that was announced on 7 April 2020. Together these measures aim to ensure that banks have sufficient assets that they can mobilise as collateral with the Eurosystem to participate in the liquidity-providing operations and to continue providing funding to the euro area economy.
Specifically, the Governing Council decided to grandfather the eligibility of marketable assets and the issuers of such assets that fulfilled minimum credit quality requirements on 7 April 2020 in the event of a deterioration in credit ratings decided by the credit rating agencies accepted in the Eurosystem as long as the ratings remain above a certain credit quality level. By doing so, the Governing Council aims to avoid potential procyclical dynamics. This would ensure continued collateral availability, which is crucial for banks to provide funding to firms and households during the current challenging times.
The following decisions have been taken:
• Marketable assets and issuers of these assets that met the minimum credit quality requirements for collateral eligibility on 7 April 2020 (BBB- for all assets, except asset-backed securities (ABSs)) will continue to be eligible in case of rating downgrades, as long as their rating remains at or above credit quality step 5 (CQS5, equivalent to a rating of BB) on the Eurosystem harmonised rating scale. This ensures that assets and issuers that were investment grade at the time the Governing Council adopted the package of collateral easing measures remain eligible even if their rating falls two notches below the current minimum credit quality requirement of the Eurosystem.
• To be grandfathered, the assets need to continue to fulfil all other existing collateral eligibility criteria.
• Future issuances from grandfathered issuers will also be eligible provided they fulfil all other collateral eligibility criteria.
• Currently eligible covered bond programmes will also be grandfathered, under the same conditions.
• Currently eligible ABSs to which a rating threshold in the general framework of CQS2 applies (equivalent to a rating of A-) will be grandfathered as long as their rating remains at or above CQS4 (equivalent to a rating of BB+).
• Assets that fall below the minimum credit quality requirements will be subject to haircuts based on their actual ratings.
Non-marketable assets are not part of the scope of the temporary grandfathering. All measures will enter into effect as soon as the relevant legal acts enter into force. The measures will apply until September 2021 when the first early repayment of the third series of targeted longer-term refinancing operations (TLTRO-III) takes place. The same end date will also apply to the collateral easing measures announced on 7 April 2020.
The ECB may decide, if and when necessary, to take additional measures to further mitigate the impact of rating downgrades, particularly with a view to ensuring the smooth transmission of its monetary policy in all jurisdictions of the euro area.
Compliments of the European Central Bank.