What changed in the European Central Bank statement — 10 September 2026

European Central Bank raised policy at 2.50%. The ECB has moved from holding rates to raising them, lifting the deposit rate to 2.50% on the back of staff projections that put inflation above target through 2027 and mark upward revisions to 2027–2028. The direction of travel is tighter for longer, but the absence of any pre-commitment and the retention of a meeting-by-meeting, data-dependent approach means the next move hinges entirely on incoming inflation and

Decision

Decision: hike
Deposit facility rate: 2.50%

Going into the decision

On the day, the committee read as hawkish — 0.6 on a scale where +3 means every member wants higher rates and −3 means every member wants cuts.

Reconstructed from official member remarks published before the decision date. 18 of 27 active members had stored official remarks.

What changed

The ECB has moved from holding rates to raising them, lifting the deposit rate to 2.50% on the back of staff projections that put inflation above target through 2027 and mark upward revisions to 2027–2028. The direction of travel is tighter for longer, but the absence of any pre-commitment and the retention of a meeting-by-meeting, data-dependent approach means the next move hinges entirely on incoming inflation and growth data, with downside growth risks the main brake on further hikes.

Inflation — More hawkish. Inflation framing stays hawkish but hardens: the July statement leaned on energy-price volatility and incomplete pass-through, while September anchors hawkishness in new staff projections showing headline at 3.0% in 2026 and upward revisions for 2027 and 2028, with core also above 2% throughout.
Labour Market — Little changed. Neither document's key passages address labour-market conditions, so no directional shift can be read on this axis.
Rate Path — More hawkish. The rate path shifts decisively from an unchanged stance at 2.25%/2.40%/2.65% with data-dependent conditional language to a delivered 25bp hike lifting the deposit rate to 2.50%, with upside inflation risks cited alongside an explicit refusal to pre-commit to a future path.
Balance Sheet — Little changed. The July reference to APP and PEPP portfolios running down at a measured, predictable pace is absent from September's key passages, giving no new balance-sheet signal in either direction.

Previous wording

The Governing Council today decided to keep the three key ECB interest rates unchanged.
rate path: Rate decision: no change, as expected, but provides certainty on current stance.

The outlook for energy prices, while highly volatile, currently stands close to the baseline of the June Eurosystem staff projections and well above the levels recorded prior to the conflict in the Middle East.
inflation: Energy prices elevated relative to pre-conflict, sustaining inflationary pressures.

Uncertainty remains high and the full inflationary impact of the energy shock has yet to play out.
inflation: Highlights upside inflation risk from incomplete pass-through, suggesting potential for further tightening if needed.

In particular, the Governing Council’s interest rate decisions will be based on its assessment of the inflation outlook and the risks surrounding it, in light of the incoming economic and financial data, as well as the dynamics of underlying inflation and the strength of monetary policy transmission. The Governing Council is not pre-committing to a particular rate path.
rate path: Reiterates data-dependent approach and no forward guidance on future cuts or hikes.

The interest rates on the deposit facility, the main refinancing operations and the marginal lending facility will remain unchanged at 2.25%, 2.40% and 2.65% respectively.
rate path: Specific levels confirm deposit rate at 2.25%, key for money market pricing.

The APP and PEPP portfolios are declining at a measured and predictable pace, as the Eurosystem no longer reinvests the principal payments from maturing securities.
balance sheet: Quantitative tightening continues passively, but pace unchanged; no active adjustment signaled.

Current wording

The Governing Council today decided to raise the three key ECB interest rates by 25 basis points. The conflict in the Middle East continues to generate inflation pressures, and inflation is set to remain well above target for an extended period.
rate path: Confirms a 25bp hike driven by inflation, the core hawkish policy signal for rates.

The baseline of the new ECB staff projections sees headline inflation averaging 3.0% in 2026, 2.5% in 2027 and 2.1% in 2028.
inflation: Headline inflation is projected above target through 2027, supporting a restrictive stance.

For inflation excluding energy and food, the baseline foresees 2.5% in 2026, 2.6% in 2027 and 2.3% in 2028.
inflation: Core inflation remains above 2%, keeping pressure on the ECB to stay restrictive.

The outlook remains highly uncertain, with risks to the upside for inflation and to the downside for economic growth.
rate path: Upside inflation risk supports further tightening bias, though growth downside adds uncertainty.

It will follow a data-dependent and meeting-by-meeting approach to determining the appropriate monetary policy stance.
rate path: No preset path; keeps optionality for future meetings.

Official statement

Monetary policy decisions

10 September 2026

The Governing Council today decided to raise the three key ECB interest rates by 25 basis points. The conflict in the Middle East continues to generate inflation pressures, and inflation is set to remain well above target for an extended period. Today’s decision underscores the Governing Council’s commitment to setting monetary policy to ensure that inflation stabilises at its 2% target in the medium term.

The baseline of the new ECB staff projections sees headline inflation averaging 3.0% in 2026, 2.5% in 2027 and 2.1% in 2028. For inflation excluding energy and food, the baseline foresees 2.5% in 2026, 2.6% in 2027 and 2.3% in 2028. Compared with June, the baseline projection for inflation in 2026 is unchanged, while it has been revised up for 2027 and 2028. The baseline projection for economic growth is 0.9% for 2026, 1.4% for 2027 and 1.5% for 2028. This is an upward revision for both 2026 and 2027, mainly reflecting the greater than expected resilience of the euro area economy.

The outlook remains highly uncertain, with risks to the upside for inflation and to the downside for economic growth. In relation to the energy shock, the updated scenarios put together by staff illustrate the broad range of outcomes for how growth and inflation would evolve under different assumptions about its intensity and duration, as well as its indirect and second-round effects.

With today’s decision, the Governing Council remains well positioned to navigate the uncertainty caused by the conflict. It will follow a data-dependent and meeting-by-meeting approach to determining the appropriate monetary policy stance. In particular, the Governing Council’s interest rate decisions will be based on its assessment of the inflation outlook and the risks surrounding it, in light of the incoming economic and financial data, as well as the dynamics of underlying inflation and the strength of monetary policy transmission. The Governing Council is not pre-committing to a particular rate path.

Key ECB interest rates

The Governing Council decided to raise the three key ECB interest rates by 25 basis points. Accordingly, the interest rates on the deposit facility, the main refinancing operations and the marginal lending facility will be increased to 2.50%, 2.65% and 2.90% respectively, with effect from 16 September 2026.

Asset purchase programme (APP) and pandemic emergency purchase programme (PEPP)

The APP and PEPP portfolios are declining at a measured and predictable pace, as the Eurosystem no longer reinvests the principal payments from maturing securities.

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The Governing Council stands ready to adjust all of its instruments within its mandate to ensure that inflation stabilises at its 2% target in the medium term and to preserve the smooth functioning of monetary policy transmission. Moreover, the Transmission Protection Instrument is available to counter unwarranted, disorderly market dynamics that pose a serious threat to the transmission of monetary policy across all euro area countries, thus allowing the Governing Council to more effectively deliver on its price stability mandate.

The President of the ECB will comment on the considerations underlying these decisions at a press conference starting at 14:45 CET today.

Background reading

Cadence's comparison is generated from the official documents. Read the methodology.