The ECB kept its base rate at 4.5%

The European Central Bank (ECB) kept its base rate at 4.5%. About it it says in a message from the bank.

Rates on deposits (4%) and margin loans (4.75%) also remained at the same level.

“Today the Governing Council decided to keep the ECB’s three key interest rates unchanged. <...> Inflation is expected to continue to remain too high for too long and domestic price pressures to remain strong,” it said.

The ECB added that the regulator’s previous decisions to raise rates help reduce inflation. At the same time, the regulator confirmed its readiness to return inflation to the target of 2%. At the end of September, inflation in the Eurozone slowed down to 4.3% for the first time since October 2021

The previous meeting of the ECB Governing Council took place on September 14. Then the regulator for the tenth time in a row accepted decision to raise all three interest rates by 0.25%. At the end of September, ECB President Christine Lagarde, speaking in the European Parliament, reportedthat the bank intends to keep rates high for “an extended period of time” as this will help Eurozone countries reduce inflation to target levels.

The regulator expects inflation to be 5.6% in 2023, 3.2% in 2024, and 2.1% in 2025. The growth of the EU economy in 2023 will slow down to 0.7%, in 2024 it will grow by 1%, in 2025 – by 1.5%, follows from the updated forecast.