Monetary Policy Decisions Impact Economic Future
The European Central Bank (ECB) has announced its decision to maintain the current key interest rates on October 30, 2025. This move comes as inflation remains near the medium-term target of 2%. The ECB’s Governing Council believes that the inflation outlook is stable, and the economy continues to show growth despite global challenges.
Current Economic Landscape
Several factors contribute to economic resilience, including a strong labor market and the solid financial health of the private sector. The past interest rate cuts are also significant in supporting this stability. However, uncertainties persist, particularly due to global trade disputes and geopolitical tensions.
Monetary Policy Approach
The ECB is committed to achieving the 2% inflation target in the medium term. The Council will adopt a data-driven strategy, assessing economic and financial indicators in each meeting to determine the appropriate monetary policy stance.
- The interest rates will remain at:
- Deposit facility: 2.00%
- Main refinancing operations: 2.15%
- Marginal lending facility: 2.40%
Asset Purchase Programs
The portfolios of both the Asset Purchase Programme (APP) and the Pandemic Emergency Purchase Programme (PEPP) are decreasing at a controlled pace. This is due to the ECB no longer reinvesting in maturing securities.
The Governing Council is prepared to adjust its instruments to ensure inflation stabilizes at the 2% target. Additionally, the Transmission Protection Instrument is available to address any market disturbances that threaten effective monetary policy transmission throughout the euro area.
Future Communications
The President of the ECB is scheduled to address the media at 14:45 CET to further explain the factors influencing today’s decisions. This transparency aims to enhance public understanding of the ECB’s actions regarding monetary policy.
