The European Central Bank cut its deposit facility rate by 25 basis points to 2.00% at its June 2025 meeting, delivering its eighth reduction and completing a full 200 basis points of easing since the rate-cutting cycle began in June 2024. The Governing Council indicated that further easing would depend on incoming data.
The June decision brings the deposit facility rate to 2.00%, a level that the ECB has identified as lying within the range of its neutral rate estimate — the theoretical setting at which monetary policy neither stimulates nor restrains economic activity.
EIGHT CUTS IN TWELVE MONTHS
The cutting cycle that began in June 2024 comprised eight cuts, interrupted only by a pause in July 2024.
The cumulative 200-basis-point reduction was from a peak of 4.00% reached during the ECB's tightening of 2022 and 2023.
Throughout the cutting cycle, the ECB maintained its data-dependent framework, committing to no predetermined rate path and insisting that each decision would be made on the basis of the most recent economic and financial data.