The European Central Bank (ECB) decided on Thursday to keep its key interest rates unchanged, in line with market expectations. The decision comes despite a rise in inflation in the eurozone to its highest level in three years. The central bank’s key rate, the deposit rate, remains at 2.5%, after a 25 basis point increase in September.
The institution’s Governing Council said that rising energy prices pose increasing risks to the inflation outlook and downside risks to economic growth. However, underlying inflation and wages have been broadly stable so far. Financing conditions have tightened since the last meeting, which is expected to affect both inflation and economic growth.
Headline inflation in the eurozone reached 3.8% last month, the highest level since September 2023. Energy price inflation hit 18.8% amid ongoing turmoil in the Middle East.
Source: CNBC