2025.12.1813:16:29UTC+00ECB Leaves Rates on Hold as Expected

In December 2025, the European Central Bank (ECB) opted to maintain borrowing costs for the fourth consecutive meeting, keeping the main refinancing rate steady at 2.15% and the deposit facility rate at 2.0%. This decision was in line with market expectations. ECB policymakers affirmed their commitment to a data-driven and meeting-by-meeting strategy in determining the most suitable monetary policy approach. Concurrently, the central bank issued updated staff projections indicating an upward revision in economic growth, primarily fueled by robust domestic demand. Growth forecasts have been adjusted to 1.4% for 2025, 1.2% for 2026, and 1.4% for both 2027 and 2028. Regarding inflation, projections suggest an average rate of 2.1% in 2025, decreasing to 1.9% in 2026, 1.8% in 2027, and rising slightly to 2.0% in 2028. The inflation estimate for 2026 has been revised upwards, mainly due to expectations of a slower decline in services inflation.