The outlook for the economy remains uncertain

The European Central Bank (ECB) has kept all three key interest rates unchanged, according to a statement from the regulator.

The deposit rate has been left at 2%, the main refinancing operations rate at 2.15%, and the marginal lending facility rate at 2.4%.

According to the ECB, inflation remains close to the medium-term target of 2%, and the Governing Council’s assessment of its outlook has not changed overall.

The European Central Bank has kept rates stable since June.

“The economy continues to grow despite challenging global conditions. A stable labor market, solid private sector balance sheets, and previous interest rate cuts remain important sources of resilience. However, the outlook remains uncertain, particularly due to ongoing global trade disputes and geopolitical tensions,” the regulator said.

As ECB President Christine Lagarde noted in her comments on the October meeting, the central bank is in a good position with regard to its current monetary policy stance. She described the current risks to inflation as broadly balanced. However, she said the inflation outlook remains more uncertain than usual due to the still uncertain global trade policy environment.

On October 29, the US Federal Reserve lowered its benchmark interest rate by 25 basis points (bps) to 3.75-4% per annum. The Fed’s statement notes that economic activity is growing at a moderate pace, but employment has slowed and unemployment has risen slightly, remaining at a low level. Inflation has risen since the beginning of the year and remains somewhat elevated. The regulator emphasized that uncertainty about the economic outlook remains high, and risks of a deterioration in the labor market have increased in recent months.