On 12 September 2024 the Governing Council decided to lower the deposit facility rate – one of the three key ECB interest rates, by 25 basis points. In addition, as decided and announced earlier, on 13 March 2024, ECB will proceed to changes to its operational framework for implementing monetary policy. Thus, from 18 September 2024, the spread between the rate on the marginal lending facility and the rate on the main refinancing operations will remain at 25 basis points, while the spread between the main refinancing operations and the deposit facility rate will be set at 15 basis points.

Accordingly and with effect from 18 September 2024, the deposit rate facility will be decreased to 3,50% (from 3,75%), the rate on the main refinancing operations will be decreased to 3,65% (from 4,25%) and the rate on the marginal lending facility will be decreased to 3,90% (from 4,50%).

At a national level it is expected that many people will be positively affected since there are numerous loans the base interest of which is the ECB rate on the main refinancing operations. What now remains to be seen is how and whether the base interest rate of loans which is set by the base interest rate of the lending banks according to their methodology will be affected too, in favour of the borrowers.

For the monetary policy decision of the Governing Council of the 12^th of September 2024, you can visit the link below:

https://www.ecb.europa.eu/press/pr/date/2024/html/ecb.mp240912~67cb23badb.en.html.

Rafaella Georgiou
Advocate/Partner