The European Central Bank slashed interest rates for the seventh time in a year Thursday, continuing its aggressive easing cycle as inflation cools and global trade tensions mount.
- The ECB lowered its key deposit rate by 25 basis points to 2.25% — the lowest since January 2023 — signaling growing confidence that inflation is under control while acknowledging heightened economic risks.
- “The disinflation process is well on track,” the ECB’s Governing Council said in its statement.
By The Numbers: Eurozone inflation fell for the third straight month in March, hitting 2.2% year-over-year — the lowest since November 2024.
Uncertainty: The ECB struck a cautious tone on growth, warning that the euro area faces rising headwinds due to intensifying global trade tensions.
- “The euro area economy has been building up some resilience against global shocks,” the ECB said, “but the outlook for growth has deteriorated.”
- They also warned that increased uncertainty could “reduce confidence among households and firms,” while market volatility may lead to tighter financing conditions.
Up Next: President of the ECB, Christine Lagarde, will speak later today.
