The European Central Bank (ECB) has decided to pause its recent cycle of interest rate reductions, maintaining its key rates at their current levels. Following eight consecutive easing steps, the deposit facility rate will remain at 2.0 percent, the main refinancing operations rate at 2.15 percent and the marginal lending facility rate at 2.4 percent. The decision, announced Thursday following a Governing Council meeting, reflects an assessment of recent economic data.
According to the ECB’s statement, the available data largely aligns with the Council’s previous forecasts concerning inflation. Domestic price pressures are continuing to ease and wage growth is decelerating. The ECB acknowledged the resilience of the economy despite a challenging global environment, attributing some of this strength to previous interest rate reductions.
However, the institution emphasized that the prevailing environment remains unusually uncertain, primarily due to ongoing trade tensions. The ECB reiterated its commitment to adapting all instruments within its mandate to ensure inflation stabilizes at its medium-term target of two percent.
