The European Central Bank concluded its monetary policy meeting on the 10th and decided to raise all three key interest rates in the Eurozone by 25 basis points. This is the second time this year that the ECB has raised interest rates. After this rate hike, the Eurozone deposit mechanism interest rate, main refinancing rate, and marginal loan interest rate were 2.50%, 2.65%, and 2.90%, respectively. The ECB issued a press release on the same day saying that the Middle East conflict continues to bring inflationary pressure, and the Eurozone inflation rate is expected to be significantly higher than the bank's target level of 2% for a long period of time. The purpose of this rate hike is to ensure that the Eurozone's medium-term inflation rate stabilizes at the target level. The communiqué also stated that due to the impact on energy prices, the economic outlook for the Eurozone remains highly uncertain, and inflation faces upward risks. According to the ECB's latest forecast, the Eurozone's overall inflation rate is expected to be 3% in 2026, which is the same as the June forecast, while the 2027 inflation forecast is raised to 2.5%. Meanwhile, the ECB raised the Eurozone's 2026 and 2027 economic growth forecasts slightly to 0.9% and 1.4%, respectively. ECB President Lagarde said that geopolitical factors such as the Middle East conflict are further driving up energy prices, and the overall inflation rate in the Eurozone is expected to remain significantly higher than the target level in the first half of 2027. Thereafter, as energy prices fall, and due to high interest rates, the inflation rate is expected to return to the target level around the end of next year. In June of this year, the ECB raised all three key interest rates in the Eurozone by 25 basis points, the first rate hike since September 2023.

The European Central Bank concluded its monetary policy meeting on the 10th and decided to raise all three key interest rates in the Eurozone by 25 basis points. This is the second time this year that the ECB has raised interest rates. After this rate hike, the Eurozone deposit mechanism interest rate, main refinancing rate, and marginal loan interest rate were 2.50%, 2.65%, and 2.90%, respectively. The ECB issued a press release on the same day saying that the Middle East conflict continues to bring inflationary pressure, and the Eurozone inflation rate is expected to be significantly higher than the bank's target level of 2% for a long period of time. The purpose of this rate hike is to ensure that the Eurozone's medium-term inflation rate stabilizes at the target level. The communiqué also stated that due to the impact on energy prices, the economic outlook for the Eurozone remains highly uncertain, and inflation faces upward risks. According to the ECB's latest forecast, the Eurozone's overall inflation rate is expected to be 3% in 2026, which is the same as the June forecast, while the 2027 inflation forecast is raised to 2.5%. Meanwhile, the ECB raised the Eurozone's 2026 and 2027 economic growth forecasts slightly to 0.9% and 1.4%, respectively. ECB President Lagarde said that geopolitical factors such as the Middle East conflict are further driving up energy prices, and the overall inflation rate in the Eurozone is expected to remain significantly higher than the target level in the first half of 2027. Thereafter, as energy prices fall, and due to high interest rates, the inflation rate is expected to return to the target level around the end of next year. In June of this year, the ECB raised all three key interest rates in the Eurozone by 25 basis points, the first rate hike since September 2023.