ECB Executive Board member Benoit Coeure said that the new inter-bank lending benchmark rate is fully pricing in recent rate cut. He said “we were all glad to see that the ESTR responded exactly as expected and the rate cut was fully priced through.” And, “we have a very smooth and stably money market, which is nice to see.”
The new Euro short-term rate (ESTR) will go live on October 1. It settled at -0.553% today, largely inline with ECB’s -0.5% deposit rate.
