ECB holds rates as inflation risks persist
Source: ft.com
- The European Central Bank kept its key interest rate at 4.25%, its ninth pause since September 2023.
- Inflation fell to 1.7% in September, below the 2% target, but services inflation stayed high at 3.9%.
- ECB President Christine Lagarde warned of persistent inflation risks from wage growth and geopolitical tensions.
The European Central Bank decided to hold interest rates steady amid cooling headline inflation but sticky price pressures in services and wages. ECB President Christine Lagarde and other policymakers stressed caution, citing upside risks to inflation from strong labour markets and global uncertainties. This matters to readers because it shapes borrowing costs, mortgage rates, and economic growth across Europe at a time when households and businesses crave relief.