The ECB leaves rates unchanged at 2.50%. According to analysts, a new increase is probable in December

On the day of the announcement of Christine Lagarde's resignation as president of the European Central Bank (from 7 February 2027), the Frankfurt institute met its board for a new decision on interest rates. As expected by analysts, the decision was made to pause on increases after the deposit rate was raised to 2.50% in September. The one on main refinancings remains at 2.65%, the one on marginal loans at 2.90%. Since the last meeting, explains the ECB, "financing conditions have tightened and it is likely that this will impact inflation and growth". A possible new increase is more likely during the December meeting. The objective is always to bring inflation back to 2%. It is currently at 3.8% in the Eurozone, with Eurostat data updated in September. In August it was at 3.2%.

The energy crisis

According to many, what convinces the ECB to keep rates steady are the already particularly tense global financial conditions with the volatility of the bond markets and the political and economic uncertainties, starting from the fears of an energy crisis in the winter months due to the situation in the Middle East, always on the verge of a new escalation. However, the ECB appears rather positive: "Although the energy shock is still showing all its effects, so far underlying inflation has remained substantially stable and wages have not reacted significantly in this phase", it underlines.

The crisis in France

The situation in France is also having an impact, where government bond yields have risen to their highest since 2002, with investors demanding increasingly higher premiums to lend them money. The French political crisis and social protests are weighing on the government's ability to find the right framework for approving the budget for 2027: a majority must be found for the measures necessary to reduce the deficit.

The Fed keeps rates steady

Meanwhile, the US Federal Reserve has also decided to keep interest rates steady. The decision arrived yesterday, October 28, a few days before the US midterm elections (even though President Kevin Warsh assured that the electoral date "played no role" in the choice). The cost of money in the USA, in line with expectations, therefore remains in the range between 3.75% and 4%, after the 0.25% increase, the first in three years, decided unanimously last month.