Funds parked at the European Central Bank’s deposit facility have fallen by more than half in the past 24 hours. That is no surprise: on Wednesday the governing council’s decision, made last week, to pay nothing on deposits held at the facility took effect. It was probably more surprising that any bank bothered to use the facility at all.
The slump in deposits tells us nothing about whether the latest round of rate cuts have had the desired effect in boosting lending to households, businesses and governments in the eurozone. Read more