European Central Bank held deposit rate at 2.00% and kept meeting-by-meeting approach

The European Central Bank's Governing Council left its three key interest rates unchanged on 5 February 2026, keeping the deposit facility rate at 2.00%. The rates on the main refinancing operations and the marginal lending facility were held at 2.15% and 2.40% respectively.

The decision extended a pause that began after the ECB's last rate cut in June 2025, which brought the deposit facility rate to its current level.

INFLATION OUTLOOK RECONFIRMED

The Governing Council said its updated assessment reconfirmed that inflation should stabilise at its 2% target in the medium term. It described the euro area economy as resilient, supported by low unemployment, solid private sector balance sheets, the gradual roll-out of public spending on defence and infrastructure, and the supportive effects of its past interest rate cuts.

The Council said the outlook was still uncertain, owing particularly to ongoing global trade policy uncertainty and geopolitical tensions.

GOVERNING COUNCIL KEEPS MEETING-BY-MEETING APPROACH

The ECB said it would follow a data-dependent and meeting-by-meeting approach to determining the appropriate monetary policy stance, and was not pre-committing to a particular rate path. Its decisions would continue to be based on its assessment of the inflation outlook and the risks surrounding it, in light of incoming economic and financial data, as well as the dynamics of underlying inflation and the strength of monetary policy transmission.

On its balance sheet, the Governing Council confirmed that the asset purchase programme and pandemic emergency purchase programme portfolios were continuing to decline at a measured and predictable pace, as the Eurosystem no longer reinvests the principal payments from maturing securities.