For these reasons, the ECB said banks would have to start paying going rates on their TLTRO credit, rather than the average rate over the whole duration of the loans. But the rate the ECB pays commercial banks is now back in positive territory and is likely to rise further. Analysts have warned changing the terms of loans already outstanding could deter banks from tapping similar loans in future downturns. The TLTRO cash also creates additional demand for low-risk securities, limiting the rise in rates on repurchase agreements and short-dated government bond yields. , Lagarde said that also factored into the ECB's decision.

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