Where do you see this?
In news articles about the euro zone sovereign debt crisis.
What does it mean?
LTRO stands for 'Long Term Refinancing Operation'. It refers to
a cheap long-term loan from the European Central Bank (ECB) to euro
zone banks.
Why is it important?
The point of an LTRO is to inject liquidity into the banking
system.
Banks can use cheap funds to buy higher-yielding assets
to increase profits or lend to businesses and consumers, which
would stimulate the economy.
The ECB has pumped more than $1 trillion euros (S$1.7
trillion) into the financial system via two LTROs so far.
The first round was in last December and the second was
in February this year. Both these LTROs were three-year loans at an
interest rate of 1 per cent.
Another round of LTROs is being proposed to fight the
current panic in the markets.
So you want to use the term. Just say...
"The ECB's two LTROs helped to prevent a more severe credit
crunch in the euro zone."
invest, The Sunday Times, June 24 2012, Pg 37