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The euribor speeds up its fall in view of the possible sanction on deposits.

The interbank market has reacted to the information that reached the market yesterday concerning the possible penalty on the one-day deposits that banks leave in the ECB.

Mario Draghi, president of the European monetary institution, already referred to that when he declared that they were “technically prepared” to set a negative rate on the easiness of the deposits, although until now this institution has preferred to “leave this measure in the reserve”.

But yesterday rumors restarted on a possible action from the ECB on the easiness of deposits, which is a sort of piggy bank that the monetary institution puts at the disposal of banks who wish to deposit their money for one day.

Right now, banks do not obtain any benefit from leaving their money there, as the ECB left their profit at 0% in July 2012 with the intention of reactivating the credit and preventing banks from depositing their money there instead of lending it to families and companies. But this measure was not able to reactivate the credit, because although banks do not obtain any profit, they do obtain assurance.

For this reason members of the board of the ECB are studying a possible penalty of -0,1% on the easiness of deposits, which would mean that commercial banks would have to pay for leaving their money there. (…)

The euribor at 12 months has already reacted to this measure with a fall to 0,489%, that is six thousandth opposite to the 0,495% of yesterday. This would mean that banks would be ready to lend money among them at a fairly lower interest rate, although this does not mean that they actually do it.(…)

Source: Expansión