The European Central Bank’s Governing Council announced no change to interest rates, reaffirmed inflation targeting at 2%, and provided economic and inflation outlooks amid global uncertainties.
Christine Lagarde, President of the ECB, and Luis de Guindos, Vice-President, announced that the Governing Council has decided to keep the three key ECB interest rates unchanged.
The ECB reaffirmed its commitment to stabilize inflation at 2% in the medium term. The economy grew by 0.3% in Q4 2025, driven mainly by services, with resilient manufacturing and increased construction activity. Unemployment was at 6.2% in December.
Inflation declined to 1.7% in January, with energy prices dropping significantly, while food prices increased. Underlying inflation indicators remain consistent with the 2% target. Risks include global trade tensions, geopolitical tensions, and potential supply chain disruptions, but positive factors such as public investment and structural reforms could boost growth.
Market rates have decreased, with bank lending rates for firms at 3.6% in December. Lending to firms grew by 3.0% annually, and mortgage lending increased to 3.0%. The ECB emphasized a data-dependent approach for future policy decisions and stated readiness to adjust instruments as needed.
The full details and outlook are available in the official press release on the ECB website.
