EU central bank keeps rates on hold

The European Central Bank kept its policy interest rates constant in its April meeting on Thursday in line with market expectations.

The interest rate on the main refinancing operations, the interest rates on the marginal lending facility, and the deposit facility will remain unchanged at 4.5%, 4.75% and 4% respectively, the bank announced.

Starting from July 2022, the European Central Bank (ECB) increased its interest rate from 0% to 4.5% gradually until September 2023 and then kept it unchanged until now.

Inflation has continued to drop, led by lower food and goods price inflation, the bank said, adding that most measures of underlying inflation are easing, wage growth is gradually moderating, and firms are absorbing part of the rise in labor costs in their profits.

It said: "Financing conditions remain restrictive and the past interest rate increases continue to weigh on demand, which is helping to push down inflation.

"But domestic price pressures are strong and are keeping services price inflation high."

The bank considers that its interest rates are at levels that are making a substantial contribution to the ongoing disinflation process.