This Thursday, the European Central Bank (ECB) maintains interest rates at 4.5%. This is the first brake on the upward cycle since July 2022.
“The Board of Governors decided today keep the ECB’s three key interest rates unchanged”, can be read in a note published on the ECB website.
We kept our interest rates unchanged at our last meeting.
See our monetary policy decisions https://t.co/ZXIUvujlVx pic.twitter.com/F54JWZQ7GD
– European Central Bank (@ecb) October 26, 2023
“Inflation is expected to remain very high for a long period of time and pressures on domestic prices remain strong. At the same time, inflation fell sharply in September, particularly due to strong base effects, and most measures of core inflation continued to decline,” he adds.
The ECB also indicates that previous interest rate increases “continue to be strongly transmitted to financing conditions” and that this “is increasingly curbing demand, contributing to reducing inflation.”
The Board of Governors met this Thursday in Athens, Greece, to discuss the Eurozone monetary policy.
In September, the ECB raised its official interest rates again. The interest rate applicable to the main financing operations was modified to 4.50% and the interest rate applicable to the liquidity provision line was modified to 4.75%. These rates are the amount that euro area central banks charge commercial banks for lending them money.
The permanent deposit facility will be transferred to 4.00%, which indicates the value at which the ECB remunerates the money that the banks entrust to it.
In the same statement, the Board of Governors reiterates that the ECB is “Determined to get inflation to 2% in the medium term”.
When the ECB changes key interest rates, this is reflected throughout the economy, with some of the most visible aspects being the increase in bank lending, including real estate credit.
News updated at 1:34 p.m.
Source: TSF
