ECB keeps key rates unchanged

The European Central Bank held all three benchmark rates steady on Thursday, Mettis Global reported. The deposit rate remains 2.50%, the main refinancing rate 2.65% and the marginal lending rate 2.90%. The ECB said higher energy costs have tilted risks towards faster inflation and weaker euro area growth.

The bank said the full effects of the energy shock have not yet emerged, while underlying inflation has remained broadly stable and wage growth has not materially responded. It also pointed to tighter financing conditions since its prior meeting, and said decisions will be made meeting by meeting using incoming data, without committing to a preset rate path. Its medium-term inflation objective remains 2%, while the APP and PEPP portfolios are continuing to contract as maturing bonds are not reinvested.