European Central Bank – annual report 2025

The European Parliament adopted by 443 votes to 71, with 117 abstentions, a resolution on the European Central Bank - Annual Report 2025.

Governance

Members affirmed that the statutory independence of the ECB, as enshrined in the Treaties, is a prerequisite for fulfilling its mandate, namely maintaining price stability. Recalling that the ECB is accountable to Parliament, they stressed the importance of transparency for accountability and the need for a robust institutional architecture and accountability mechanisms.

Parliament believes that the ECB must take decisions free from political pressure. However, it also recognises that while central banks must have strong independence, they must not operate in isolation. The resolution also supports the solidarity expressed by the ECB and central banks worldwide with the US Federal Reserve, which underlines the importance of preserving central bank independence, in full respect for the rule of law and democratic accountability.

Monetary policy, inflation

Concerned by the high levels of inflation in the years following the COVID-19 pandemic, Members felt that a timely return to price stability in this period would have been warranted through ECB decisions. The ECB is invited to thoroughly assess the causes of these high levels of inflation in its annual report, along with a set of policy recommendations to draw the right conclusions from any future inflationary crises. Recognising the continued risk of a resurgence in inflation, Parliament underlined that further steps towards easing monetary policy should be prudent, data-driven and guided by price stability.

In this context, Parliament expressed concern over the high cost of living, as food and energy prices have increased in Europe since the COVID-19 pandemic. It noted that, on average, the price of a meal in the euro area in 2025 was one-third higher than before the pandemic, and that this has particularly affected low-income households.

Parliament noted that the ECB's inflation target has shifted over time from a reference value of ‘below 2%’ to a target of ‘below, but close to, 2%’, and to a symmetrical target of ‘2%’ in the medium term. The ECB is invited to assess the appropriateness of its symmetric target, also taking qualitative factors into account.

End unconventional measures faster

The resolution emphasised that the ECB's asset purchase programmes are unconventional monetary policy instruments that have side effects and can distort price signals. It supports the ECB's commitment to further reduce its direct role in purchasing securities and encourages the ECB to phase out its government bond purchasing programmes.

Members regretted that the ECB's short-term lending schemes had largely displaced the private interbank funding market since the 2008 financial crisis. They called on the ECB to avoid paying banks deposit rates higher than market rates, as this runs counter to the principle of an open market economy with free competition, and to remove any obstacle hindering the recovery of short-term unsecured interbank markets.

Secondary objective: to support general economic policies in the Union

Parliament stressed the importance of sound and sustainable public finances in withstanding a high-interest rate environment, in complementing the ECB’s efforts to keep inflation low, in maintaining a stable economy and in remaining resilient to future economic and financial shocks. The ECB should also consider the potential effects of climate change from a price stability perspective, within the framework of its mandate.

Digital euro, crypto-assets

Parliament stressed that the increasing digitalisation of payments, if left exclusively to private and non-EU actors, risks creating new forms of exclusion for both users and merchants. In the context of a in a context of heightened geopolitical uncertainty and excessive dependence on non-EU payment infrastructures, Members emphasised that the introduction of a digital euro is essential to strengthening EU monetary sovereignty, reducing fragmentation in retail payments and supporting the integrity and resilience of the single market. However, they stressed the importance of maintaining the role of cash and called on the ECB to intensify the monitoring of crypto-assets, such as stablecoins.