European Central Bank headquarter in Frankfurt am Main, Germany. (Photo: AFP/VNA)

This decision follows the bank's June rate cut, its first reduction in five years. After raising interest rates at a record pace since mid-2022 to combat rising consumer prices, the ECB has begun to ease pressure as inflation rates have fallen.

The rate-setting council, led by ECB President Christine Lagarde, has had to balance concerns about a disappointing growth outlook with the need to ensure that inflation stays at the bank's 2% target.

Along with the rate cut, the ECB also lowered its economic growth forecast and kept its inflation forecast unchanged. According to the ECB’s revised report, the eurozone’s economy is expected to grow 0.8 percent in 2024, 1.3 percent in 2025, and 1.5 percent in 2026.