European Central Bank policymakers signaled growing confidence that interest rates may remain unchanged for an extended period, according to minutes from the October 29–30 Governing Council meeting. Most officials agreed that keeping rates steady remained appropriate amid elevated uncertainty and an inflation outlook moving closer to the ECB’s 2% target.

Policymakers See Possible End to Rate-Cut Cycle

The Governing Council concluded that monetary policy is currently “in a good place,” supported by resilient economic data and steady disinflation. Several members argued that the recent rate cuts may have already marked the end of the easing cycle—provided current trends persist.

Officials emphasized that the 2% deposit rate should be viewed as “sufficiently robust” to withstand potential shocks, suggesting confidence in the current stance even as global growth slows. While risks to inflation remain two-sided, policymakers noted that the broader macro outlook has stayed aligned with the ECB’s September projections.

Others on the Council urged caution, stressing the need to keep all options open given geopolitical uncertainty and uneven economic momentum across the bloc.

Eurozone Rate Holds at 2.15%; Outlook Stable

The Euro Area’s key benchmark interest rate remains at 2.15%, unchanged in recent months. Historically, the rate has averaged 1.87% since 1998, with highs of 4.75% in 2000 and a record low of 0.00% in 2016.

Trading Economics projects the rate will remain at 2.15% through the end of the quarter, with long-term expectations pointing to 2.15% in 2026 before edging lower to 1.90% by 2027 as inflation normalizes.

What’s Next?

The ECB continues to navigate a delicate balance between maintaining restrictive policy to ensure inflation returns sustainably to target and supporting a slowing economy. With the Federal Reserve expected to deliver additional cuts in 2026, the ECB’s more cautious stance could set up a divergence in global monetary policy.

Officials reiterated that upcoming decisions will remain data-dependent, with particular attention on wage growth, inflation expectations, and credit conditions.