Central Banks Keep Rates Unchanged

19. March 2026, 15:45

The European Central Bank (ECB) does not change the rates. The main interest rate stays at 2.0 percent. The Bank of England also keeps its rate at 3.75 percent. Both banks decided this on Thursday.

The reason for this choice is the war in the Middle East. There are fights there since late February. This makes oil and gas expensive. When energy gets more costly, other prices often rise too. People call this inflation.

The banks actually wanted to lower rates soon. Higher rates make loans costly. This slows down the economy. But because of high prices, the banks now wait. They first want to see how prices change.

Christine Lagarde leads the ECB. She says: The bank watches the situation closely. The bank can change rates any time. The goal is a stable economy. Inflation should be about 2 percent.

Definitions

Main Interest Rate

The main interest rate is an important price for money. The central bank sets this rate. Other banks must pay this rate when they borrow money. A high main rate makes loans more costly.

Inflation

Inflation means things get more costly. This means goods and services become dearer. You get less for the same money than before.

European Central Bank

The European Central Bank (ECB) is the bank for the Euro. It looks after the value of money in Europe.

People

Christine Lagarde

Christine Lagarde is a politician from France. She is the President of the European Central Bank.

Locations

Europe

Europe is a continent with many countries. Many of these countries use the Euro as money.

England

England is a part of Great Britain. It has its own central bank.