The European Central Bank’s Governing Council increased key interest rates by 25 basis points to address inflation, with rates effective from September 16, 2026. The decision reflects ongoing uncertainty and economic resilience.
The Governing Council of the European Central Bank (ECB) has decided to raise the three key interest rates by 25 basis points, effective from September 16, 2026. The rates are now 2.50% for the deposit facility, 2.65% for the main refinancing operations, and 2.90% for the marginal lending facility.
This decision is driven by inflation pressures, partly due to ongoing conflict in the Middle East, which is expected to keep inflation above target for an extended period. The ECB aims to stabilize inflation at its 2% target in the medium term.
Projections indicate headline inflation averaging 3.0% in 2026, 2.5% in 2027, and 2.1% in 2028. Excluding energy and food, inflation is forecasted at 2.5%, 2.6%, and 2.3% respectively. Economic growth is projected at 0.9% in 2026, 1.4% in 2027, and 1.5% in 2028, with upward revisions for 2026 and 2027 due to economic resilience.
The outlook remains uncertain, with risks skewed to higher inflation and lower growth. The ECB will continue to monitor incoming economic and financial data and adopt a data-dependent, meeting-by-meeting approach to monetary policy decisions. The Governing Council emphasizes that it is not pre-committing to a specific rate path.
The asset purchase programmes (APP and PEPP) are being phased out at a measured pace, with no reinvestment of principal payments from maturing securities.
The ECB stands ready to adjust its instruments within its mandate to ensure inflation stabilizes at 2% and to maintain effective monetary policy transmission. The Transmission Protection Instrument remains available to counter disorderly market dynamics that threaten monetary policy transmission across the euro area.
The ECB President will provide further comments during a press conference starting at 14:45 CET today.
