Surge in ECB Lending by Banks

Something is most definitely going on behind the scenes in Europe right now.

The surge in emergency overnight borrowing by banks from the European Central Bank has continued, prompting market observers to speculate about what may be behind the trend.

A total of €15 billion was drawn from the ECB’s “marginal lending facility” on Tuesday night, on top of €14.8 billion lent on Monday night and the €17.3 billion borrowed last Thursday, the highest since June 2009.

The level of overnight borrowing remains exceptionally high even by the standards of the past few months. Typically banks draw just millions of euro from the overnight facility.

– The Irish Times

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