The decision taken by the governing council of national banks brings the interest rates on the deposit facility, the main refinancing operations and the marginal lending facility down to 2.5%, 2.65% and 2.9% respectively, with effect from March 12.
“Monetary policy is becoming significantly less restrictive, with interest rate cuts making new borrowing less onerous for companies and households and credit growth recovering. At the same time, an adverse factor for the easing of financing conditions stems from the fact that previous increases in interest rates are still being passed on to the stock of credit, with lending remaining generally weak,” explains the monetary authority led by Christine Lagarde in a statement quoted by the newspaper Negócios.
“The disinflationary process is well underway. Inflation has continued to evolve broadly in line with our staff's expectations and the latest projections are closely aligned with the previous inflation outlook,” says the ECB.
Translated with DeepL.com (free version)
