Rates rise again: new borrowers face higher interest costs
After the cuts of 2024 and 2025, the ECB and the Fed raised rates again in 2026; the Bank of England holds at 3.75 per cent and decides on 5 November.
The ECB's deposit rate has stood at 2.50 per cent since 16 September, 0.50 percentage points above its end-2025 level, and the upper bound of the Fed's target range at 4.00 per cent, 0.25 points higher. The Bank of England has not moved in 2026 and, at 3.75 per cent, sits between the two.
What happened
Facts: according to the official rate tables, the ECB's deposit rate stood at minus 0.50 per cent from September 2019 to July 2022, rose to 4.00 per cent by September 2023 and fell to 2.00 per cent by June 2025. In June and September 2026 the ECB raised it to 2.50 per cent; the Fed moved to 3.75-4.00 per cent in September 2026. Both held on 28 and 29 October. The Bank of England has been at 3.75 per cent since December 2025; the Swiss National Bank kept its rate at 0 per cent in September. Assessment: the easing phase is over for now. How much dearer credit becomes depends on whether the central banks stay on hold.
Data: Policy rates of the ECB, the Fed and the Bank of England, 2020 to 2026
| 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | Okt. 26 | |
| ECB | -0.5 | -0.5 | 2 | 4 | 3 | 2 | 2.5 |
| Fed | 0.25 | 0.25 | 4.5 | 5.5 | 4.5 | 3.75 | 4 |
| Bank of England | 0.1 | 0.25 | 3.5 | 5.25 | 4.75 | 3.75 | 3.75 |
What changes in practice
- Borrowers
- The ECB deposit rate is 2.50 per cent, against 2.00 per cent at end-2025. New loans and refinancings follow the higher level; existing fixed rates do not.
- Savers
- Rates on instant-access accounts usually follow the deposit rate with a lag. With inflation at 3.8 per cent in September, the real return stays negative.
- Companies
- Dollar funding is priced off a Fed range of 3.75-4.00 per cent. For business in Britain, the Bank of England decides on 5 November.
Sources
- EZB: Leitzinsen (Official interest rates)
- Federal Reserve: Open Market Operations, Zielspanne Federal Funds Rate
- Bank of England: Official Bank Rate history
- Bank of England: MPC-Termine 2026 und 2027
- SNB: Geldpolitische Lagebeurteilung vom 24. September 2026
- Eurostat: Annual inflation up to 3.8% in the euro area (16. Oktober 2026, Kopie der Veröffentlichung)