ECB allocates first funds under targeted lending program as some banks to wait until December

The European Central Bank has held the first round of the Targeted Long-term Operations program, which is aimed to lend extremely cheap money to Eurozone's banks. They, in turn, are supposed to start lending this money to real economy. It total, monetary policymakers managed to allocate 82.6 billion euro for the present first step. The four-year loans will have an annual interest rate of 0.15%. As a final result, the ECB intends to improve banks' liquidity, end low inflation period in the single currency area and overcome deflation fears among economists. In total, the pan-European monetary regulator is planning a 1 trillion euro large support package, while the TLTROs are only one part of it. All actions are assumed to boost the balance sheet of the ECB to 3 trillion euro.

The next round of cheap money injections into the system are scheduled to take place in December. Moreover, the policymakers are discussing the idea of buying privately owned assets under the long-awaited quantitative easing program. Purchases of government bonds are on the table as well, but the ECB will pay the main attention to private assets. Meanwhile, a number of analysts doubt in success of August operations, which are most likely to give any effect in the long-term. In addition, some banks may postpone the period of taking money from the central