ECB cuts rates for third time this year as Europe braces for Trump tariffs

The ECB in Frankfurt, Germany. Financial markets expect central banks in all major economies to cut rates this year as tariffs hit global trade and slow growth. Photograph: Michael Probst/AP

The cost of borrowing has fallen across the 20-member euro area for the third time this year after the European Central Bank cut its main interest rate to 2.25% in response to slowing growth and Donald Trump’s tariffs.

The Frankfurt-based bank cut its benchmark deposit rate by a quarter of a percentage point on Thursday, in line with economist expectations, to tackle a slowdown in the bloc and the impact from the border taxes imposed earlier this month on all EU imports into the US.