What's going on?

The European Central Bank (ECB) concluded its most recent meeting on Thursday � but not much came of it in terms of new information or impact on the markets. It leaves open some key questions for September�s meeting.

What does this mean?

The ECB is directly buying the government bonds of countries in the eurozone, i.e. ones that use the Euro as their currency (you can find out why in our previous story). Partly as a result of this, many government bonds are trading at a price that offers investors negative interest rates (remember, price and interest rates, a.k.a. �yield,� move inversely – click here for more on that). Negative interest rates mean that an investor is guaranteed to lose money if they buy the bond and hold it until expiry. The ECB has said that it won�t buy any bonds that offer a return of less than -0.4%. The problem is that lots of government bonds currently only offer less than that limit � and so the ECB is running out of bonds that it can buy. There�s a decent chance that the ECB will amend that limit at its meeting in September, although ECB President Mario Draghi didn�t hint that this was likely (as some investors thought he would).

Why should I care?

For markets: Amending the rules would probably be good for bond prices.
Rather simply, if the ECB changes its self-imposed limit, then it will start buying government bonds that offer even more negative interest rates – and that would increase the price of those bonds.

For you personally: Low interest rates aren�t going anywhere anytime soon.
The simple fact that the market�s focus is on what more the ECB will potentially do at a time when there are negative interest rates galore suggests that interest rates in Europe are very likely to stay low for the foreseeable future. That means: low mortgage rates and cheap(ish) loans � at least for those that can qualify for them (e.g. you still need a deposit to buy a home in most instances).