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Key interest rate
Wirtschaftab 13 J.
The interest rate at which banks borrow money from the central bank. Indirectly determines interest for savers and borrowers. ECB key rate 2026: about 2.75%.
The key interest rate (Leitzins) is the most important interest rate in an economy. It is set by the central bank and determines the price at which banks can borrow money.
Chain of effects: key rate rises → banks borrow money at higher cost → pass higher interest rates on to customers → loans become more expensive, saving becomes more worthwhile → people spend less → inflation falls.
And the other way round: key rate falls → loans become cheaper → people spend more → the economy is stimulated.
Did you know? The ECB's main refinancing rate was 0.0% from June 2014 to July 2022 – more than 8 years of zero interest. The deposit rate was even negative: banks had to PAY the ECB to park money.
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