GBAF Logo
Eagle S tanker involved in undersea cable damage case in Finland - Global Banking & Finance Review
The Eagle S oil tanker, accused of damaging undersea cables in the Gulf of Finland, faces legal charges. This incident highlights growing concerns over maritime safety and infrastructure security in the Baltic Sea region.
Finance

ECB not using neutral rate estimate to decide policy, Lagarde says

Published by Global Banking & Finance Review

Posted on June 22, 2026

1 min read

· Last updated: June 22, 2026

Add as preferred source on Google
Finance Banking Markets

ECB Not Using Neutral Rate Estimate to Decide Policy, Says Lagarde

ECB Policy and the Neutral Interest Rate

Lagarde's Statement on Policy Decision-Making

FRANKFURT, June 22 (Reuters) - The European Central Bank's estimate for the neutral interest rate, which neither stimulates nor slows growth, is not used as an explicit goalpost by policymakers when setting interest rates, ECB President Christine Lagarde said on Monday.

ECB's Neutral Rate Estimate and Market Implications

Comments from Chief Economist Philip Lane

ECB chief economist Philip Lane earlier said the neutral rate is somewhere between 1.75% and 2.50%, a touch higher than earlier thought and this has raised some talk among ECB watchers that the ECB could still raise its 2.25% deposit rate one more time without leaving the neutral range.

Market Reactions and Speculation

(Reporting by Balazs Koranyi; Editing by Andrew Cawthorne)

Key Takeaways

  • Lagarde emphasized the neutral rate is not a formal benchmark in monetary decisions, highlighting a flexible, data-driven approach. (streetinsider.com)
  • Philip Lane’s updated estimate places the neutral rate between roughly 1.75% and 2.50%, slightly higher than prior assessments. (abc.az)
  • ECB policymakers continue to focus on incoming economic data and multiple scenarios, avoiding reliance on any single indicator, including the neutral rate. (econostream-media.com)

References

Frequently Asked Questions

What is the neutral interest rate according to the ECB?
ECB chief economist Philip Lane estimates the neutral rate to be between 1.75% and 2.50%.
Is the ECB using the neutral rate estimate as a policy goal?
No, Christine Lagarde stated the ECB does not use the neutral rate as an explicit goalpost for policy decisions.
Could the ECB still raise its deposit rate?
Yes, some believe the ECB could raise its 2.25% deposit rate one more time without exceeding the neutral range.
Who reported on the ECB's neutral rate and Lagarde's comments?
The article was reported by Balazs Koranyi and edited by Andrew Cawthorne.

Tags

Related Articles

Image for Porsche CEO confirms forecast despite persistent challenges, speech text shows

Porsche CEO confirms forecast despite persistent challenges, speech text shows

Image for RWE raises stake in power grid operator Amprion for $4.1 billion

RWE raises stake in power grid operator Amprion for $4.1 billion

Image for Can anyone fix Britain? Regular change of PM a symptom of UK's malaise

Can anyone fix Britain? Regular change of PM a symptom of UK's malaise

Image for Belgium issues visas to Taliban delegation for EU meeting

Belgium issues visas to Taliban delegation for EU meeting

Image for EU trade chief set to host China's commerce minister on June 29

EU trade chief set to host China's commerce minister on June 29

Image for India's Tata Electronics hit by cyber breach claiming to expose Apple, Tesla trade secrets

India's Tata Electronics hit by cyber breach claiming to expose Apple, Tesla trade secrets

More from Finance

Explore more articles in the Finance category

Image for Czech government plans to ban mobile phones in schools from 2027
Czech government plans to ban mobile phones in schools from 2027
Image for Partners Group shares slip below early-June low
Partners Group shares slip below early-June low
Image for Why Investors Are Revisiting Multi-Asset Funds in an Era of Persistent Volatility
Why Investors Are Revisiting Multi-Asset Funds in an Era of Persistent Volatility
Image for Czech group Sev.en GI files suit to reclaim $1 billion in losses at Callide C plant in Australia
Czech group Sev.en GI files suit to reclaim $1 billion in losses at Callide C plant in Australia
Image for Eastern and central European countries demand EU strengthens carbon fund for poorer members
Eastern and central European countries demand EU strengthens carbon fund for poorer members
Image for Czech cabinet bars president and ex-NATO commander from NATO meeting, setting up fight
Czech cabinet bars president and ex-NATO commander from NATO meeting, setting up fight
Image for International Fundraising Platforms Supporting Cross-Border Donations in 2026
International Fundraising Platforms Supporting Cross-Border Donations in 2026
Image for Euro zone consumer confidence rises to -17.7 in June
Euro zone consumer confidence rises to -17.7 in June
Image for After Brexit, a Polish entrepreneur finds her future back home
After Brexit, a Polish entrepreneur finds her future back home
Image for Shares of Russia's Gazprom fall below 100 roubles, lowest since 2009
Shares of Russia's Gazprom fall below 100 roubles, lowest since 2009
Image for No job offer for UK's Streeting from Burnham, Streeting says
No job offer for UK's Streeting from Burnham, Streeting says
Image for Lloyds weighs bid for Aldermore as South Africa's FirstRand seeks exit, Sky News reports
Lloyds weighs bid for Aldermore as South Africa's FirstRand seeks exit, Sky News reports
View All Finance Posts