European Central Bank reports €1.3 billion loss in 2025

The European Central Bank has published its financial report for 2025, documenting the longest series of losses in the institution's history. The financial result closed with a deficit of €1.25 billion, which nevertheless represents a significant improvement compared to 2024, when the loss was nearly €8 billion. The reduction in the negative result was possible thanks to interest rate cuts, which lowered the costs of servicing commercial deposits. The document also revealed that the salary of ECB President Christine Lagarde increased to €492 thousand per year. Despite the difficult accounting situation, the bank's authorities predict a return to profitability as early as 2026, which is expected to be the result of stabilizing the securities portfolio and the phasing out of costly refinancing operations. The European Central Bank, established in 1998, generated profits for most of its history, which were distributed to the central banks of eurozone countries. The situation changed drastically after 2022, when sharp interest rate hikes in response to inflation forced the ECB to pay high interest to commercial banks.During a speech in the European Parliament, Christine Lagarde emphasized that the primary goal remains price stability. According to forecasts from the European Central Bank, inflation in the eurozone should stabilize at the target level of 2% in the medium term. The bank's head also addressed the impact of artificial intelligence on the economy, reassuring that this technology is not currently causing a wave of layoffs, and Europe is not falling behind in terms of productivity. Meanwhile, positive signals have been recorded in Germany, as inflation in some federal states has already fallen below the 2% threshold, triggering optimistic reactions on European stock exchanges. According to the ECB's statute, financial losses do not directly affect the bank's ability to conduct market operations or maintain currency stability, as this institution cannot go bankrupt in the classic market sense.Simultaneously, a debate is ongoing in Brussels regarding the future of the automotive sector and the ETS system. A group of 150 prominent scientists, including Nobel laureate Giorgio Parisi, has issued an appeal to maintain strict emission standards, opposing attempts by some national governments to relax climate policy. In France, data was confirmed showing GDP growth of 0.9% for the entire year of 2025, which is assessed as a result above earlier pessimistic market expectations. „L'inflazione si stabilizzerà al 2% nel medio termine.” (Inflation will stabilize at 2% in the medium term.) — Christine Lagarde