Eurozone · Cycle layer · Indicator

Real policy rate

0.00 %
Triggered above threshold since Jun 2026 · tightening
As of Sep 2026 · Threshold > 10-yr mean + 1 pp, and rising
Recession, Jan 2008 to Jun 2009Recession, Jul 2011 to Mar 2013Recession, Oct 2019 to Jun 2020−4−202Threshold > 10-yr mean + 1 pp, and risingTrigger > 10-yr mean + 1 pp, and rising20052010201520202025
2000 to 2026 · percent. Shaded bands are recessions.* *Euro-area bands follow the CEPR quarterly dating from the peak quarter.
What it is

The policy rate minus core HICP inflation over the past year, read at the end of each month: how hard monetary policy is braking. The threshold is the series' own ten-year mean plus one point, so each region has a baseline that fits its history and nothing is estimated. It triggers only while the policy rate is also higher than six months earlier; above the level with rates on hold or falling it is on Watch.

Threshold source: worldstat.us construction: the real rate a point above its ten-year mean while the policy rate is higher than six months earlier. How thresholds are chosen

Known weaknesses

A worldstat.us rule with no published track record. The ten-year mean includes the zero-rate years, which lowers the baseline everywhere. The deposit facility rate became the ECB's effective policy rate only in 2022; before that the refinancing rate led.