The European Central Bank’s governing council decided to keep ECB interest rates unchanged at today’s meeting. As the ECB announced, the key interest rates remain unchanged, with the deposit facility rate maintained at 2%. This decision was largely expected, as according to a Reuters poll conducted earlier, almost all participating economists predicted that the ECB’s governing council would not proceed with an interest rate cut today, while 60% forecast that the next rate cut (likely by 0.25%) will take place in September, in light of the Central Bank’s new macroeconomic projections.
Read: ECB decides on interest rates – Expected to leave them unchanged
As the ECB announced, the decision to keep interest rates unchanged is linked to achieving the inflation target of 2%. Overall, new data aligns with the governing council’s previous assessment regarding inflation prospects. Domestic price pressures continued to moderate, with wages increasing at a slower pace. Reflecting in part the previous interest rate cuts by the governing council, the economy has so far proven generally resilient in a challenging global environment. At the same time, the environment remains highly uncertain, particularly due to trade disputes.
ECB President Christine Lagarde is expected to explain the reasoning behind this decision at the customary press conference that will follow shortly.
