Keynote speech by Philip R. Lane, Member of the Executive Board of the ECB, at the Government Borrowers Forum 2025

Dublin, 11 June 2025

I am grateful for the invitation to contribute to the Government Borrowers Forum. I will use my time to cover three topics.^[1] First, I will briefly discuss last week’s monetary policy decision.^[2] Second, I will describe some current features of the euro area bond market.^[3] Third, I will outline some innovations that might expand the scope for euro-denominated bonds to serve as safe assets in global portfolios.

Monetary policy

At last week’s meeting, the Governing Council decided to lower the deposit facility rate (DFR) to two per cent. The baseline of the latest Eurosystem staff projections foresees inflation at 2.0 per cent in 2025, 1.6 per cent in 2026 and 2.0 per cent in 2027; output growth is foreseen at 0.9 per cent for 2025, 1.2 per cent in 2026 and 1.3 per cent in 2027. The lower inflation path in the June projections compared to the March…