# ECB Holds Rates Steady as Energy Shock Complicates Inflation Outlook

The deposit rate remains 2.5%; the central bank cited rising energy costs and tighter financing conditions without committing to its next move.

By Will Langan | 24X7 News
Published: 2026-10-29T14:06:42.865Z
Updated: 2026-10-29T14:06:42.865Z
Section: World
Format: News
Canonical: https://24x7news.us/articles/ecb-interest-rate-decision-october-29-2026

The European Central Bank kept its three main interest rates unchanged on October 29, warning that a prolonged energy shock could push inflation higher while weakening growth.

The deposit facility rate remains 2.5%. The main refinancing rate stays at 2.65%, and the marginal lending rate at 2.9%.

In its decision, the Governing Council said underlying inflation had remained broadly stable and wages had not yet shown a material response to the energy shock. However, it said the shock’s greater size and duration increased the risk that higher energy costs would spread into other prices.

The bank also cited tighter financing conditions since its previous meeting, which it expects to weigh on both economic activity and inflation.

Officials retained their medium-term 2% inflation target and said decisions would depend on incoming data, underlying price pressures and how monetary policy passes through the economy. The statement committed to no particular future rate path.

The ECB also confirmed that its APP and pandemic-era PEPP bond portfolios continue to shrink because principal repayments are no longer reinvested.

This account reflects the bank’s policy statement, rather than a prediction of its next decision.

Sources:
European Central Bank — October 29 Monetary Policy Decisions: https://www.ecb.europa.eu/press/pr/date/2026/html/ecb.mp261029~9a493adf17.en.html

## Sources
- European Central Bank — October 29 Monetary Policy Decisions: https://www.ecb.europa.eu/press/pr/date/2026/html/ecb.mp261029~9a493adf17.en.html