Latest Updates

• ECB Monetary Policy Decision: March 2026 2026-03-19 09:15

  

  The ECB kept its key policy rates unchanged at 2.00%, 2.15%, and 2.40% in March 2026, while revising inflation forecasts higher and growth projections lower amid heightened energy-driven uncertainty.

  • The deposit facility rate remained at 2.00%, the main refinancing rate at 2.15%, and the marginal lending facility at 2.40%, reflecting a continued pause with a data-dependent policy stance.

  • Headline inflation is projected at +2.6% YoY in 2026, +2.0% in 2027, and +2.1% in 2028, with the 2026 forecast revised higher compared to December, primarily due to rising energy prices linked to the Middle East conflict.

  • Core inflation (excluding energy and food) is projected at +2.3% YoY in 2026, +2.2% in 2027, and +2.1% in 2028, also revised higher, indicating spillover effects from energy costs into broader price pressures.

  • Economic growth is forecast at +0.9% YoY in 2026, +1.3% in 2027, and +1.4% in 2028, representing a downward revision, particularly for 2026, reflecting weaker real incomes and confidence due to higher commodity prices.

  • Inflation has been running around the 2% target with longer-term expectations well anchored, suggesting underlying stability despite near-term upward pressure from energy prices.

  • Scenario analysis indicates that a prolonged energy supply disruption would push inflation above baseline and growth below baseline, highlighting asymmetric risks tied to the duration and intensity of the shock.

  • The ECB emphasized that monetary policy will remain data-dependent and meeting-by-meeting, with no pre-commitment to a specific rate path as uncertainty around inflation and growth remains elevated.

  • Balance sheet normalization continues, with APP and PEPP portfolios declining at a measured pace as reinvestments are no longer being made, maintaining gradual quantitative tightening alongside steady rates.

  Source
• ECB Monetary Policy Decision: February 2026 2026-02-05 08:15

  

  The ECB kept its three key policy rates unchanged in February 2026, maintaining a steady stance as inflation is expected to stabilise near target amid resilient growth.

  • The deposit facility rate remained at 2.00%, the main refinancing operations rate at 2.15%, and the marginal lending facility rate at 2.40%, leaving policy settings unchanged.

  • The Governing Council reaffirmed that inflation should stabilise at its 2% target in the medium term, based on its updated assessment of the outlook.

  • Economic activity was described as resilient despite global uncertainty, supported by low unemployment, solid private-sector balance sheets, public spending on defence and infrastructure, and the lagged effects of past rate cuts.

  • Ongoing risks to the outlook were highlighted, particularly from global trade policy uncertainty and geopolitical tensions.

  • The ECB reiterated a data-dependent, meeting-by-meeting approach with no pre-commitment to a specific rate path, tying decisions to incoming data and underlying inflation dynamics.

  • The APP and PEPP portfolios continued to decline in a measured and predictable manner as maturing securities are no longer reinvested.

  • The Governing Council emphasized it stands ready to adjust all policy instruments if needed to ensure inflation returns sustainably to 2% and to safeguard monetary policy transmission.

  Source
• ECB Monetary Policy Decision: December 2025 2025-12-18 08:15

  

  The ECB held its three key policy rates unchanged in December 2025, while staff projections still point to inflation converging to 2% and growth strengthening on firmer domestic demand.

  • Policy rates: The deposit facility rate stayed at 2.00%, the main refinancing operations rate at 2.15%, and the marginal lending facility rate at 2.40%, maintaining an unchanged policy stance.

  • Inflation outlook (Dec projections): Headline inflation is projected to average 2.1% (2025), 1.9% (2026), 1.8% (2027), and 2.0% (2028), consistent with inflation stabilising around target over the medium term.

  • Underlying inflation (Dec projections): Inflation ex energy and food is projected at 2.4% (2025), 2.2% (2026), 1.9% (2027), and 2.0% (2028), with 2026 revised up because services inflation is expected to decline more slowly.

  • Growth outlook (Dec projections): Real GDP growth is projected at 1.4% (2025), 1.2% (2026), 1.4% (2027), and 1.4% (2028), revised higher versus September and attributed especially to stronger domestic demand.

  • Comparison with Sep projections: September projected headline inflation of 2.1% (2025), 1.7% (2026), and 1.9% (2027), and core inflation of 2.4% (2025), 1.9% (2026), and 1.8% (2027), implying a higher 2026 inflation track in December alongside modestly firmer growth.

  • Balance-sheet policy: APP and PEPP portfolios continue to decline in a “measured and predictable” way as maturing principal is no longer reinvested, reinforcing ongoing balance-sheet runoff.

  • Reaction function and backstops: The ECB reiterated a data-dependent, meeting-by-meeting approach with no pre-commitment to a rate path, and noted it can deploy tools including the Transmission Protection Instrument to address disorderly market dynamics that impair transmission.

  Source
• ECB Monetary Policy Decision: October 2025 2025-10-30 09:15

  

  The ECB left all three key policy rates unchanged in October 2025, maintaining a data-dependent stance as inflation remains near the 2% target and growth shows moderate resilience despite global uncertainty.

  • The deposit facility rate was held at 2.00%, the main refinancing rate at 2.15%, and the marginal lending facility at 2.40%, all unchanged from prior levels.

  • The Governing Council stated that inflation is close to the 2% medium-term target, with the overall outlook broadly unchanged from previous assessments.

  • Economic activity has continued to grow, supported by a strong labour market, healthy private sector balance sheets, and prior rate cuts that continue to provide support.

  • Policymakers highlighted that uncertainty persists due to global trade disputes and geopolitical tensions, which could affect growth prospects.

  • The ECB reaffirmed its meeting-by-meeting approach and emphasized that future policy moves will depend on inflation dynamics, underlying trends, and monetary transmission strength.

  • The balance sheet continues to shrink, as the Eurosystem is no longer reinvesting principal payments from maturing securities under the APP and PEPP programmes.

  Source
• ECB Monetary Policy Decision: September 2025 2025-09-11 08:15

  

  The ECB left all three key policy rates unchanged in September 2025, with inflation projected to remain close to the 2% medium-term target and growth expectations slightly adjusted.

  • The deposit facility rate was held at 2.00%, the main refinancing rate at 2.15%, and the marginal lending facility at 2.40%.

  • Headline inflation is projected to average 2.1% in 2025, 1.7% in 2026, and 1.9% in 2027, broadly unchanged from June’s outlook.

  • Core inflation (ex-energy and food) is expected at 2.4% in 2025, easing to 1.9% in 2026 and 1.8% in 2027.

  • GDP growth was revised up to 1.2% in 2025 (from 0.9% in June), while 2026 was lowered to 1.0%, and 2027 remained at 1.3%.

  • The ECB reaffirmed its data-dependent, meeting-by-meeting approach, emphasizing flexibility and avoiding pre-commitment to a rate path.

  • Balance sheet runoff continues as both the APP and PEPP portfolios decline, with no reinvestment of maturing securities.

  Source
• ECB Monetary Policy Decision: July 2025 2025-07-24 08:15
  

  The ECB held all three key policy rates steady in July 2025, maintaining the deposit rate at 2.00%, refinancing rate at 2.15%, and lending rate at 2.40%, following 200 bps of cuts since June 2024.

  • Inflation is “broadly in line” with projections, with headline inflation now at the 2% medium-term target.
  • Borrowing costs have eased notably, with non-financial corporate rates down -147 bps YoY (May 2024 to May 2025), supporting economic resilience.
  • Wage growth is moderating, with Q1 2025 negotiated wages rising just 2.45% YoY (vs 4.15% in Q4 2024), reducing upside inflation risks.
  • The ECB cited “exceptionally uncertain” global conditions, especially unresolved EU–US trade tensions, as a key reason for the pause.
  • Lagarde emphasized downside risks to growth from higher tariffs, a stronger euro, and financial market volatility, but also signaled a “wait-and-watch” posture going forward.

  Source
• ECB Monetary Policy Decision: June 2025 2025-06-05 08:15
  

  The ECB cut its three policy rates by 25bps on June 5, lowering the deposit rate to 2.00%, refinancing rate to 2.15%, and lending rate to 2.40%, citing sustained progress toward its 2% inflation target.

  • ECB staff now forecast headline inflation at 2.0% in 2025 (down -0.3pp from March), 1.6% in 2026, and 2.0% in 2027; core inflation seen at 2.4% in 2025 and 1.9% in 2026–2027.
  • Real GDP growth is projected at 0.9% in 2025, 1.1% in 2026, and 1.3% in 2027, with uncertainty from trade tensions weighing on near-term investment and exports.
  • Wage growth remains elevated but is moderating; profit margins are helping to offset inflationary pressure.
  • Scenario analysis suggests that further trade escalation could drag both growth and inflation below baseline forecasts.
  • The ECB reaffirmed a data-dependent approach and avoided forward guidance, keeping future rate moves open-ended amid persistent global uncertainty.

  Source
• ECB Monetary Policy Decision: April 2025 2025-04-17 08:15
  

  As most expected, the ECB cut its three policy interest rates following the conclusion of the April meeting. dropping the deposit rate to 2.25%, the main refinancing rate to 2.40%, and the marginal lending rate to 2.65%. This is the third straight quarter point cut in 2025, and the fifth straight cut of any size since September 2024. In total, the ECB’s policy rate is down -210 bps over the last two years which means that the central bank has undone almost half of the tightening done during the inflationary post-COVID period in 2022-2023.

  Inflation Outlook

  

  The ECB believed it could cut this month because it has seen progress on the inflation front. The statement is clear to point out that “the disinflation process is well on track,” indicating that the current trend in price growth is following the ECB’s expectations. Notably, services inflation has eased in the last few months and has become a driver of that disinflation. In the March euro area inflation report, the contribution from the services component to headline inflation was down to 1.56 ppts from 1.78 ppts in December 2024, a solid -22 bps drop. This trend gives the ECB confidence that underlying inflation is trending in the right direction toward the 2% medium-term target.

  Growth Outlook

  As the members become more optimistic about the inflation outlook, they can pivot to the rising risks to the growth outlook. The obvious rising risk to address is the uncertainty that stems from the volatility in US trade policy that now directly affects the euro area following the “Liberation Day” announcement of reciprocal tariffs. The ECB anticipates that uncertainty from trade tensions is “likely to reduce confidence among households and firms,” and the market reaction to the policies is tightening financial conditions. In general, these factors are impacting the economic outlook.

  We have seen this rhetoric about balancing inflation concerns and the new risks to the growth outlook from other central banks, including the Bank of England and the Bank of Canada. Both of those institutions have quickly shifted their economic outlooks, especially Canada, but at the same time, they both asserted their commitments to containing inflation. However, neither cut rates like the ECB has today. This is mostly because of differences in inflation trends, and it highlights how dovish the ECB inflation outlook is.

  Policy Guidance

  At the end of the statement, the ECB continued its data-dependence stance, and it specifically noted that it “is not pre-committing to a particular rate path.” The lack of guidance dampens some of the dovishness of the statement as it keeps a pause very much on the table for the next meeting in June. This will give time for ECB members to see two more inflation reports (April and May) and dozens more updates on US trade policies, which are consistently in flux.

  

  This cut looks to be more driven by the positive inflation outlook than a response to weaker economic conditions. The latest March inflation report was a very positive development as core inflation fell to 2.4% YoY, the lowest rate since January 2022, and it probably had a major impact on ECB members going into the meeting. And with tariffs, both by the US and potential retaliatory measures, bringing the potential for upward inflationary pressures in the next few quarters, the ECB might not have had another chance to point to a solid disinflation trend to cut.

  Tariff Outlook

  There was no discussion in the statement about how the ECB sees trade developments impacting the economy, but ECB President Lagarde dropped some hints during the press conference. In general, Lagarde highlighted the uncertainty that tariffs bring to the outlook as ECB members do not fully agree on the potential impacts as of right now: “There are diverging views on short, and long-term impact, developments,” and, the ECB will need to time to get a “clearer” view of the “net impact of tariffs on inflation.” One quote was clearer: “Tariffs are a negative demand shock.” This one sticks out to me because it seems like a signal that Lagarde is focused on the downside risks to growth from the tariffs and that they could be a net deflationary event. This would paint today’s cut as more dovish than the statement makes it out to be.

  Press conference

  Source
• ECB Monetary Policy Decision: February 2025 2025-03-06 08:15

  ECB Monetary Policy Decision: February 2025

  The ECB lowers its three key interest rates by 25 bps, moving the deposit facility to 2.50%, the main refinancing operations rate to 2.65%, and the marginal lending facility rate to 2.90%.

  Indicator	2025	2026	2027
  Headline Inflation (YoY%)	2.3% (Dec: 2.1%)	1.9% (Dec: 1.9%)	2.0% (Dec: 2.1%)
  Core Inflation (YoY%)	2.2% (Dec: 2.3%)	2.0% (Dec: 1.9%)	1.9% (Dec: 1.9%)

  • On inflation:

  Indicator	2025	2026	2027
  GDP Growth	0.9% (Dec: 1.1%)	1.2% (Dec: 1.4%)	1.3% (Dec: 1.3%)

  • On growth:
  • The ECB asserts that it is not pre-committing to a particular rate path and will continue to be data dependent.
  • There is no direct mention of US policy changes, but the ECB has gone out of its way to highlight the heightened level of uncertainty that the euro area faces.

  Source
• ECB Monetary Policy Decision: January 2025 2025-01-30 08:15

  The ECB lowered its three key interest rates by 25 bps setting the the deposit facility to 2.75%, the main refinancing operations to 2.90%, and the marginal lending facility to 3.15%. The ECB noted that the “APP and PEPP portfolios are declining at a measured and predictable pace.” In terms of inflation, the ECB said that “the disinflation process is well on track” and that inflation “is set to return to the Governing Council’s 2% medium-term target in the course of this year.” The ECB said that the economy is still facing “headwinds” but that “rising real incomes” and lower rates should “support a pick-up in demand over time.”

  Source