monthly · % · Bank for International Settlements

Euro area — central bank policy rate

Euro area: the whole economy →

Euro area's policy rate was 2.5% in September 2026, and a year out it is expected to be higher than that.

October 2026

2.5%

2.4% to 2.6%

Usually within 0.1 of the outcome at this range

September 2027

2.9%

2.5% to 3.4%

Usually within 1.2 of the outcome at this range

The ranges are not a feeling about confidence. They are how far this method has actually been off before: half of past outcomes landed inside them, and half outside. The nearer one is tighter because the near future genuinely is more knowable than the far one.

What markets are pricing in

3.3%

By September 2027 that is 0.84 pp higher than today's 2.50%, and all of it is what the bond market already prices in. At that horizon the euro area yield curve implies 3.35%.

Not a model fitted to past policy rate: it is read off prices that already exist, and it is wrong whenever the market is.

%. Sources: Euro area — Bank for International Settlements. Retrieved 2026-10-08. Everything after the dotted line is a forecast, not a record. The shaded band is where this method has landed half the time in the past — so half the time, outside it. No language model produces any of these numbers.

How far off this forecast has usually been

Every method was replayed from each of the last three years' starting points, seeing only what was known at the time, and scored against what actually happened for Euro area.

The forecast drawn above has landed within 0.10% of the outcome on average a month ahead, and within 1.23% a year ahead.

How far each forecasting method has been off in the past, and how often its stated range held.
Method	Usually off bya month ahead	Usually off bya year ahead	Its range heldit claims 50 in 100	vs. the simple rulebelow 1.00 is better
What markets are pricing in	0.08%	0.51%	5 in 10	8.21
Assume last year repeats	0.08%	1.22%	8 in 10	19.76
Theta	0.08%	1.22%	7 in 10	19.77
The middle of all methodsthe one drawn above	0.10%	1.23%	6 in 10	19.92
Exponential smoothing	0.10%	1.27%	5 in 10	20.60
Automatic ARIMA	0.10%	1.28%	6 in 10	20.78

Euro area, measured over the last 25 starting points. The last column compares each method against the simplest rule there is — assume this period repeats what it did a year ago. Below 1.00 means smaller errors than that rule, above it means worse. All of it is measured against today's revised figures rather than against what was known at the time, which flatters every method here a little.

Where the methods disagree

A year out the methods stop agreeing. The spread is not a flaw to be hidden: it is the honest size of what nobody knows yet, and it is why the chart above draws the middle of them rather than picking a favourite.

Euro area, September 2027. The dot is what each method expects, the bar how far it would not be surprised to be wrong. They are run on the same numbers and still land 0.8% apart, which is the honest size of the disagreement — and the reason the chart above draws the middle of them rather than picking a favourite.

Compare with other economies

This page is one country held still. To put Euro area beside others, or to change the window, use the full chart — whatever you choose there stays in the address, so the view is the link.

Central bank policy rate, all countries →