In brief

• The European Central Bank kept interest rates unchanged, despite pressure resulting from energy prices.
• The deposit rate remains at 2.5%, and the bank did not raise rates in October.
• The decision also concerns people repaying loans in euro and the discussion about rates in Poland ahead of the MPC meeting on 3-4 November.

Rates unchanged, price pressure still present

The Governing Council of the European Central Bank decided that interest rates will remain at their current level (Jest decyzja o stopach procentowych. Zainteresuje osoby z kredytem w euro – Business Insider Polska) (Stopy procentowe w strefie euro pozostaną bez zmian. EBC nie zdecydował się na kolejną podwyżkę – Puls Biznesu). The deposit rate still stands at 2.5%. The market expected this move, and in October the bank did not decide on a third rate hike this year (Stopy procentowe w strefie euro bez zmian. Rynek stawia na podwyżkę w grudniu – Bankier.pl).

Energy as the main threat

The bank concluded that rising energy prices threaten both inflation prospects and economic growth in the euro area. ECB President Christine Lagarde indicated that high energy prices will drive inflation (Bank centralny reaguje na wysokie ceny energii. Od tego zależą raty kredytów – WNP.pl). The financial market, on the other hand, assumes a possible rate hike in December.

Significance for borrowers and Poland

For people with euro loans, the decision means that installments will not change in the near future. The Polish Monetary Policy Council, which will meet on 3-4 November, will also feel the impact. The discussion about the level of rates in Poland will largely refer to what the ECB has done.