Crédit Mutuel AM: ECB policy on hold

Crédit Mutuel AM: ECB policy on hold

9 september 2025

ECB

By François Rimeu, Senior Strategist, Crédit Mutuel Asset Management

As markets anticipated, the European central bank (ECB) is expected to keep rates unchanged in September.

 The latest economic data do not justify another cut, and the trade agreement concluded in July with the United States, capping tariffs at 15% for the vast majority of European exports, has reduced uncertainty.

Our main expectations:

  • The deposit facility rate will remain unchanged at 2.0%, while the rates on the main refinancing operations and the marginal lending facility will be maintained at 2.15% and 2.40% respectively.
  • At the press conference, ECB President Christine Lagarde is likely to highlight the resilience of the euro area economy and inflation being aligned with the 2% medium-term target.
  • The new projections should remain broadly unchanged from those in June: growth around 1% in 2025 and 2026, before rebounding to 1.3% in 2027; core inflation at 2.4% in 2025, converging slightly below 2% in the medium term (1.9% in 2027)

In summary

With rates now considered neutral, inflation aligned with target and growth proving more resilient than expected, the ECB is set to maintain a cautious stance. Future adjustments will likely be data-dependent, with decisions made on a meeting-by-meeting basis.

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