ECB holds deposit rate at 2.5 percent as Lagarde to leave on February 7, 2027

The European Central Bank on October 29 left its three key interest rates unchanged. The deposit facility rate stayed at 2.5 percent, the main refinancing rate at 2.65 percent and the marginal lending rate at 2.90 percent. The same day, President Christine Lagarde announced that she leaves office on February 7, 2027. The news was carried by Euronews and others, and the decision is also published on the ECB’s website.

The numbers at a glance. Deposit rate: 2.5 percent. Main refinancing rate: 2.65 percent. Marginal lending rate: 2.90 percent. Eurozone inflation in September: 3.8 percent, against 3.2 percent in August. ECB target: 2 percent. According to Euronews, the ECB raised rates twice this year, most recently in September.

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What the ECB says. Energy prices continue to rise, which carries risks of higher inflation and weaker growth. Underlying inflation is relatively stable for now, and wages show no significant response. Financing conditions have tightened since the previous meeting. The Council will decide meeting by meeting, based on the data, and is not committing to a particular rate path.

Timeline of the departure. In February 2026 the Financial Times reported that Lagarde would leave before her term ends in October 2027, and the ECB then said she is focused on her mission and has made no decision. In June Lagarde dismissed talk of an early exit, and in July she said she would not leave before 2027. On October 29 she announced the date: February 7, 2027, about nine months before the end of her eight-year term. The ECB gave no reason, and reports link the timing to the presidential election in France in April 2027.

Who may succeed her. According to Euronews, Spain’s Pablo Hernández de Cos and the Netherlands’ Klaas Knot are seen as frontrunners. In the first half of 2027 two other seats on the six-member Executive Board also open, among them the seat of chief economist Philip Lane. No official list of candidates has been published.

What it means for Macedonia. The denar is pegged to the euro, so ECB decisions and eurozone inflation matter for the Macedonian economy. However, it has not been published how this decision directly affects Macedonian loans or prices, so we give no such assessment.

What is not known. We do not know whether there will be another increase at the next meeting, because the ECB is not committing. It is also not known who will succeed Lagarde, or when the selection procedure will begin.

Comparison with Macedonia. According to the State Statistical Office, annual inflation in Macedonia in September was 2.7 percent, against 3.8 percent in the eurozone. This is a comparison of two figures for the same month, not an explanation of why they differ, and the two measurements may not be fully comparable in methodology.

Why Lagarde is leaving early. The ECB gave no reason. All that remain are the reports linking the timing to the French elections, which is an interpretation, not a confirmed reason. What matters is that the ECB has several months to organise a transition and that interest rate decisions will be made by the same council.

The next signal. Eurozone inflation data and energy prices until the Council’s next meeting. Until then, the October 29 decision means a pause, not the end of tightening.

MKNews Hub · Macedonia · October 30, 2026