European Central Bank cuts interest rates by 25 basis points

 The European Central Bank (ECB) has announced a 25 basis point cut to its key interest rates, marking the seventh reduction since June last year, amid economic concerns heightened by tariffs imposed by US President Donald Trump.

Following the decision by the ECB’s Governing Council, the deposit facility rate — the bank’s main interest rate — now stands at 2.25 percent.

In its policy statement, the ECB noted a deterioration in growth prospects due to escalating trade tensions. ECB President Christine Lagarde said rising uncertainty could weaken confidence among households and businesses, warning that a negative and volatile market response to trade tensions could tighten financial conditions.

Nevertheless, Lagarde affirmed that the ECB’s efforts to curb inflation remain on track.