MNI BRIEF: ECB On Hold, Inflation At Target in 2028

The European Central Bank left its three key interest rates unchanged on Thursday and confirmed in an updated economic assessment that inflation should stabilise at the 2% target in the medium term. (see MNI ECB WATCH: Rates On Hold, Eyes On Projections, Language )

The interest rates on the deposit facility, the main refinancing operations and the marginal lending facility will remain unchanged at 2.00%, 2.15% and 2.40% respectively.

The new Eurosystem staff projections show headline inflation averaging 2.1% in 2025, 1.9% in 2026, 1.8% in 2027 and 2.0% in 2028. On core inflation, staff project an average of 2.4% in 2025, 2.2% in 2026, 1.9% in 2027 and 2.0% in 2028. Inflation has been revised up for 2026, mainly because staff now expect services inflation to decline more slowly, the ECB's policy statement noted. (see MNI SOURCES: No Significant Shift Seen In ECB Dec Projections )