The European Central Bank raises its key rates by 25 basis points

Second turn of the screw in three months. The European Central Bank raised its three key rates by 25 basis points this Thursday, September 10. This decision, widely expected, responds to new inflationary pressures caused by the conflict in the Middle East and the rise in energy prices. The deposit facility rate now reaches 2.50%, compared to 2.25% since June. This is the second increase decided by the ECB in 2026.

From September 16, the rate for main refinancing operations will increase to 2.65%, while that of the marginal lending facility will reach 2.90%. The ECB presents its decisions at a press conference organized exceptionally in Berlin.

The institution now forecasts average inflation of 3% in 2026, then 2.5% in 2027 and 2.1% in 2028. Excluding energy and food products, it would reach 2.5%, 2.6% and 2.3% respectively. The sustainable return to the 2% objective is therefore moving away slightly.

Growth is expected to hold up better than expected, with GDP growth estimated at 0.9% this year, 1.4% in 2027 and 1.5% in 2028. Despite this improvement, the ECB estimates that the risks remain upward for inflation and downward for activity.

Christine Lagarde has not yet given any firm indication on the next decision. The Governing Council will continue to decide on a meeting-by-meeting basis based on available data. The APP (Asset Purchase Program) and PEPP (Pandemic Emergency Purchase Program) portfolios will continue to contract at the same time, with maturing securities no longer being reinvested.