The European Central Bank left interest rates unchanged today for the fifth time in a row, despite inflation in the eurozone falling to 1,7%, below the ECB's target of 2%.
For financial institutions, the ECB deposit rate remains at 2,00%, the refinancing rate at 2,15% and the marginal lending rate at 2,40%.
The ECB did not hint at a future rate cut and maintains its policy stance at each meeting. The institution says it bases its interest rate decisions primarily on new economic data. It considers inflation expectations and the associated risks, the development of underlying inflation, and the impact of interest rate changes on the economy.
ECB expects inflation to stabilize
The ECB expects inflation to stabilize at its 2% target over the medium term. The latest inflation figures from Eurostat show that inflation in the eurozone has fallen to 1,7%. Incidentally, the latest Dutch inflation figure, according to the European calculation method, is 2,2%.
"The economy remains resilient in a challenging global environment," the ECB said. According to Eurostat, the eurozone economy grew by 0,3% in the fourth quarter of 2025. This growth was primarily driven by the services sector, particularly information and communication. "Low unemployment, solid private sector balance sheets, the gradual rollout of government spending on defense and infrastructure, and the supportive effects of our previous interest rate cuts are supporting growth," ECB President Christine Lagarde said at a press conference.
The central bank also emphasized that the outlook remains uncertain, due to uncertainty surrounding global trade policy and geopolitical tensions. "A renewed increase in uncertainty could weigh on demand. A deterioration in sentiment in global financial markets could also dampen demand. Further friction in international trade could disrupt supply chains, reduce exports, and weaken consumption and investment," Lagarde said.
She also points to geopolitical tensions, particularly Russia's war against Ukraine. On the other hand, according to the ECB, higher defense and infrastructure spending and the adoption of new technologies could actually boost growth more than expected. New trade agreements and a strengthening of the European single market could also contribute, the central bank says.
The Fed and BoE also keep interest rates unchanged
The US Federal Reserve also kept interest rates unchanged last week after three consecutive rate cuts. Key policy rates there are now between 3,5% and 3,75%. The Bank of England also kept interest rates unchanged on Thursday (at 3,75%) after cutting them four times.