European Central Bank keeps interest rates unchanged

The Governing Council of the European Central Bank (ECB) decided on October 29, 2026, to maintain its three key interest rates at their current levels. The deposit facility rate remains at 2.50%, the main refinancing operations rate at 2.65%, and the marginal lending facility rate at 2.90%. This decision follows a similar wait-and-see approach adopted by the U.S. Federal Reserve.

The ECB expressed concern that rising energy prices pose significant upward risks to inflation and downward risks to economic growth. While underlying inflation has remained stable and wage growth has not shown a significant reaction, the bank warns that the duration and intensity of the current energy disturbances could drive prices higher. Inflation in the Eurozone reached 3.8% in September, remaining well above the ECB's medium-term target of 2%.

Moving forward, the ECB stated that it is not pre-committing to a specific interest rate path. Future decisions will be made on a meeting-by-meeting basis, evaluating incoming economic data, the outlook for inflation, and the transmission of monetary policy. While analysts suggest a potential rate hike in December, the Governing Council emphasized that its policy trajectory remains data-dependent.