During her press conference, European Central Bank President Christine Lagarde outlined the ECB’s decision to cut key interest rates by 25 basis points at the March policy meeting. She elaborated on the rationale behind the move, emphasizing its role in supporting economic stability.
ECB press conference key highlights
“Consumer confidence remains fragile”
“Services are resilient”.
“Uncertainty is holding back investment”.
“Surveys suggest that employment growth is subdued”.
“Domestic inflation remains high”.
“Recent wage deals point to a continued moderation of wage pressures”.
“Risks to growth remain tilted to the downside”.
“Trade tensions could lower growth”.
“Defence and infrastructure spending could add to growth”.
This section below was published at 13:15 GMT to cover the European Central Bank’s (ECB) monetary policy announcements and the immediate market reaction.
On Thursday, as widely expected, the European Central Bank (ECB) reduced its key rates by 25 basis points at the March policy meeting. This move puts the main refinancing operations rate at 2.65%, while the marginal lending facility and deposit facility rates now stand at 2.90% and 2.50%, respectively.
ECB policy statement key takeaways
Inflation has continued to develop broadly as staff expected, and latest projections closely align with previous inflation outlook.
Staff now see headline inflation averaging 2.3% in 2025, 1.9% in 2026, and 2.0% in 2027.
For inflation excluding energy and food, staff project an average of 2.2% in 2025, 2.0% in 2026, and 1.9% in 2027.
Domestic inflation remains high, mostly because wages and prices in certain sectors are still adjusting to past inflation surge with a substantial delay.
Monetary policy is becoming meaningfully less restrictive, as interest rate cuts are making new borrowing less expensive for firms and households, and loan growth is picking up.
At the same time, a headwind to easing of financing conditions comes from past interest rate hikes still transmitting to stock of credit, and lending remains subdued overall.
Economy faces continued challenges, and staff have again marked down their growth projections – to 0.9% for 2025, 1.2% for 2026, and 1.3% for 2027.
Downward revisions for 2025 and 2026 reflect lower exports and ongoing weakness in investment, in part originating from high trade policy uncertainty as well as broader policy uncertainty.
Especially in current conditions of rising uncertainty, it will follow a data-dependent and meeting-by-meeting approach to determining appropriate monetary policy stance.
In particular, interest rate decisions will be based on its assessment of inflation outlook in light of incoming economic and financial data, dynamics of underlying inflation, and strength of monetary policy transmission.
ECB is not pre-committing to a particular rate path.
Market reaction to ECB rate decision
EUR/USD trades with decent gains above the 1.0800 barrier, or new YTD peaks, after the ECB’s rate decision.
Euro PRICE Today
The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the strongest against the Canadian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.19% | 0.12% | -0.86% | 0.18% | 0.02% | -0.18% | -0.59% | |
| EUR | 0.19% | 0.29% | -0.70% | 0.36% | 0.21% | 0.00% | -0.40% | |
| GBP | -0.12% | -0.29% | -0.99% | 0.07% | -0.09% | -0.28% | -0.68% | |
| JPY | 0.86% | 0.70% | 0.99% | 1.06% | 0.92% | 0.68% | 0.31% | |
| CAD | -0.18% | -0.36% | -0.07% | -1.06% | -0.15% | -0.36% | -0.76% | |
| AUD | -0.02% | -0.21% | 0.09% | -0.92% | 0.15% | -0.20% | -0.60% | |
| NZD | 0.18% | -0.00% | 0.28% | -0.68% | 0.36% | 0.20% | -0.39% | |
| CHF | 0.59% | 0.40% | 0.68% | -0.31% | 0.76% | 0.60% | 0.39% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the U
