The European Central Bank, at its meeting in Frankfurt, left the deposit rate unchanged at 2%. The rate on main refinancing remains at 2.15%, that on marginal loans at 2.40%. This was communicated by the ECB, which is maintaining rates at the 2% reached last June, after having reduced them by two percentage points with eight cuts in a year.
The Eurosystem’s latest projections “indicate overall inflation equal to an average of 2.1% in 2025, 1.9% in 2026, 1.8% in 2027 and 2.0% in 2028″, explains the ECB. Inflation net of the energy and food component would average 2.4% in 2025, 2.2% in 2026, to 1.9% in 2027 and 2.0% in 2028. Inflation has been revised upwards for 2026, mainly because experts now expect services inflation to fall more slowly. The Governing Council is determined to ensure that inflation stabilizes at the 2% target over the medium term. adopted from time to time at each meeting”, reads the ECB press release. In particular, the decisions of the Governing Council on interest rates will be based “on the assessment of the inflation outlook and the risks associated with them, considering the new economic and financial data, as well as the dynamics of underlying inflation and the intensity of monetary policy transmission, without being tied to a particular rate path”.
Frankfurt raises its growth estimate for the euro area to 1.4% in 2025
The European Central Bank, at its meeting in Frankfurt, improved its growth estimate for the euro area in 2025 to 1.4%, from 1.2% three months ago. The growth forecast for 2026 was raised to 1.2% from 1% and that for 2027 to 1.4% from 1.3%. “Economic growth should be more sustained than the September projections, driven in particular by domestic demand”; explains the ECB in its statement.