Official ECB announcements and press releases

ECB Cuts Rates to 3%, Drops 'Restrictive' Language, Trims Forecasts

Dec 12, 2024, 01:22 PM

The European Central Bank (ECB) has cut interest rates by 25 basis points, as expected, marking the fourth rate reduction this year and bringing rates to their lowest since February 2023. The deposit facility rate has been lowered to 3.00% from 3.25%, the main refinancing rate reduced to 3.15% from 3.40%, and the marginal lending facility decreased to 3.40% from 3.65%. The ECB cited a slower economic recovery and trimmed inflation forecasts, with 2024 inflation now expected at 2.4% (previously 2.5%) and 2025 inflation forecasted at 2.1% (previously 2.2%). The GDP outlook has also been revised lower for 2025 to 1.1% from 1.3%. The central bank emphasized that the disinflation process is well on track, is determined to ensure inflation stabilizes at its 2% medium-term target, and is not pre-committing to a particular rate path. Additionally, the ECB has dropped "restrictive" language from its statement.