Meeting in Florence for two days, the Governing Council of the European Central Bank (ECB) decided on Thursday 30 October to leave its key rates unchanged for the third time in a row. The deposit facility rate, the main refinancing operations, and the marginal lending facility are therefore maintained at 2.00, 2.15 and 2.40 percent respectively.
“Inflation remains close to our 2% medium-term target and our assessment of the inflation outlook is broadly unchanged. The economy has continued to grow despite the challenging global environment. The robust labour market, solid private sector balance sheets and our past interest rate cuts remain important sources of resilience”, explained ECB President Christine Lagarde, adding that the decision had been taken unanimously by the governors.
According to the September projections from the Monetary Institute, general price inflation in the euro area could reach 2.1% in 2025, 1.7% in 2026 and 1.9% in 2027. The annual inflation rate rose in September to 2.2%, compared with 2% in August (see EUROPE 13733/23).
However, the outlook remains uncertain, particularly in view of global trade disputes and geopolitical tensions. Mrs Lagarde stressed that the Governing Council had not committed to any predefined path for its key rates, citing a “more uncertain than usual” outlook for inflation.
“The EU-US trade deal reached over the summer, the recently announced cease fire in the Middle East, and today’s announcement of progress in the US-China trade negotiations have mitigated some of the downside risks to economic growth. At the same time, the still volatile global trade environment could disrupt supply chains”, said the ECB President.
In addition, the Governing Council believes that the euro area urgently needs to strengthen its economy in the current geopolitical context. “It is essential to implement the European Commission’s competitiveness roadmap swiftly. Governments should prioritise growth-enhancing structural reforms and strategic investment, while ensuring sustainable public finances”, said Mrs Lagarde.
According to the ECB’s latest Economic Survey, GDP growth in the euro area is set to reach 1.2% in 2025, 1.0% in 2026 and 1.3% in 2027 (see other news).
The ECB Governing Council will meet in Frankfurt on Wednesday 17 and Thursday 18 December for another monetary policy decision-making meeting.
See the ECB’s decisions of 30 October 2025: https://aeur.eu/f/j7v (Original version in French by Bernard Denuit)