The European Central Bank (ECB) has decided to maintain the deposit rate at 2.0 percent at an interest rate meeting. The central bank wrote in a press release on Thursday.
This is the fourth interest rate meeting in a row that the ECB has maintained the interest rate. Inflation has stabilized around the central bank's target of 2.0 percent - and the ECB expects inflation to remain stable in the coming years.
The central bank expects average inflation in the eurozone to end at 2.1 percent in 2025, and to be 1.9 percent next year, 1.8 percent in 2027 and 2.0 percent in 2028.
The ECB is the central bank for the 20 countries that use the euro as their currency, but its decisions also have an impact on other countries - including Denmark, which has a fixed exchange rate policy, so the value of the krone follows the euro.
DI chief economist does not expect new cuts for the time being
According to Allan Sørensen, chief economist at the Confederation of Danish Industry, there is no prospect of interest rate changes for the time being.
- The ECB does not have any more interest rate cuts up its sleeve. The ECB has halved the key interest rate over the past two years, but now the time for interest rate cuts is over. The ECB has not changed the interest rate in the past six months, and it probably will not during 2026, says Allan Sørensen in a written comment.
He adds that the interest rate is at a neutral level, where there is a risk that "new interest rate cuts could cause inflation to flare up again".
At the same time as its decision on the interest rate, the ECB has given its forecast for how much growth will be in the eurozone in the coming years. Next year, the ECB expects growth of 1.2 percent. In 2027, growth will be 1.4 percent, and growth will remain at this level in 2028, the central bank predicts.
Growth will end in 2025 at an average of 1.4 percent, the ECB says. This is slightly higher growth than the ECB expected after its interest rate meeting in September. It was stated that growth this year would end at 1.2 percent.
The growth forecasts, together with inflation, are contributing to the central bank holding on to the existing interest rate, points out Jeppe Juul Borre, chief economist at AL Sydbank.
- Inflation has come firmly under control, and at the same time the growth prospects point to cautious economic progress. In addition, the central bank is adjusting its expectations for both inflation and growth for next year, and this leaves absolutely no need to send the interest rate further down the stairs right now, says Jeppe Juul Borre in a written comment.
/ritzau/
Text, graphics, images, sound, and other content on this website are protected under copyright law. DK Medier reserves all rights to the content, including the right to exploit the content for the purpose of text and data mining, cf. Section 11b of the Copyright Act and Article 4 of the DSM Directive.
Customers with IP agreements/major customer agreements may only share Danish Offshore Industry articles internally for the purpose of handling specific cases. Sharing in connection with specific cases refers to journaling, archiving, or similar uses.
Customers with a personal subscription/login may not share Danish Offshore Industry articles with individuals who do not themselves have a personal subscription to Danish Offshore Industry.
Any deviation from the above requires written consent from DK Medier.
