The European Central Bank has once again lowered key interest rates.
The European Central Bank has lowered key interest rates. The deposit rate is now 3%, the main refinancing operation rate is 3.15%, and the marginal lending facility rate is 3.4%.
According to Reuters, the deposit rate was decreased by 0.25%: from 3.25% to 3%. In June of this year, it stood at 4%. This is the fourth rate cut of 2024, reports Ekonomichna Pravda.
The ECB lowered rates due to slowing inflation and its approach to the target level of 2%. According to ECB forecasts, inflation will be 2.4% in 2024, 2.1% in 2025, 1.9% in 2026, and 2.1% in 2027.
The ECB notes that financing conditions are easing, as the reduction in the interest rate gradually makes new borrowing less expensive for firms and households. However, conditions remain tight because monetary policy remains restrictive, and past increases in interest rates still impact the outstanding stock of loans.
It is expected that the ECB will continue its policy of lowering rates to 2-2.5% to stimulate the economy.
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