- Decision
- Maintain
- Rate change
- 0 bps
- discount rate
- 3%
The Monetary Council of the Eastern Caribbean Central Bank (ECCB), at its 18 July 2025 meeting, kept the minimum savings rate at 2.0 percent and left the discount rate unchanged at 3.0 percent for short-term credit and 4.5 percent for long-term credit, judging that monetary, credit and financial conditions remain stable and accommodative despite a more uncertain global outlook and a slightly softer regional growth projection. The move extends the unchanged stance in place since at least February 2025, when the same rate settings were reaffirmed. The Council noted that the EC dollar is well supported by a 97.5 percent backing ratio and EC$5.5 billion in foreign reserves, comfortably above the 60 percent statutory floor, and that private-sector credit—particularly to households—is expanding at its fastest pace since 2020 amid ample banking-system liquidity. The ECCU economy is now expected to grow by 3.3 percent in 2025, down from the earlier 3.5-4.5 percent range, with tourism, post-hurricane reconstruction and infrastructure investment providing the main impetus, while risks are “heavily” skewed to the downside due to global trade weakness and geopolitical tensions. Energy prices are projected to moderate next year, though the Council cautioned that they remain vulnerable to geopolitical shocks. The Council endorsed ongoing regulatory initiatives, including Basel II/III implementation and the creation of a Regional Financial Stability Committee, and highlighted opportunities from climate-resilient investment and renewable-energy development.
Rate evolution
Over the period covered, the Eastern Caribbean Central Bank kept its key administered rates unchanged, maintaining the Minimum Savings Rate at 2.0 per cent and the Discount Rate at 3.0 per cent for short-term credit and 4.5 per cent for long-term credit. The decision reflected an assessment that monetary, credit and financial conditions in the Eastern Caribbean Currency Union remained stable and accommodative, the EC dollar stayed strong, foreign reserves increased, and member economies had shown resilience, with tourism, post-hurricane Beryl reconstruction, infrastructure investment and domestic construction still expected to support activity. At the same time, the Council noted that the 2025 growth outlook had been lowered to 3.3 per cent and that the global environment had become considerably more uncertain, as weaker trade prompted lower world growth projections and energy prices, though expected to moderate, remained vulnerable to geopolitical developments.
In a subsequent communication, the Council maintained the existing stance while stressing that risks to the ECCU outlook were tilted heavily to the downside amid renewed geopolitical and geoeconomic tensions, even as the banking system remained resilient and liquid and private sector credit accelerated, particularly through household lending. On 13 February 2026, it again held both rates, citing stable domestic conditions and moderating global inflation, while noting that the EC dollar remained strong, the banking sector was stable and highly liquid, and risks from geopolitical tensions, shifting trade and policy regimes, commodity price volatility, and uncertainty around global mobility and financial flows remained elevated. On 10 July 2026, the Council again maintained the rates as the reserve backing ratio stood at 97.6 per cent and foreign reserves at XCD5.9 billion, while flagging downside risks to growth from oil-price volatility, trade uncertainty and geopolitical conflict that could weaken tourism demand.