The ECB will keep interest rates unchanged on Thursday but is still open to a possible cut

The ECB will keep interest rates unchanged this Thursday, according to Reuters, even as inflation across the 20-country euro zone slows to match the central bank’s 2% ￰0￱ despite this hold, the possibility of further easing hasn’t been ruled ￰1￱ inside the ECB say they’re pausing, not stopping, while watching how things play out with ￰2￱ policy, Germany’s fiscal push, and political chaos in ￰3￱ bank had already cut its key rate in half this year, landing at 2% by ￰4￱ then, it’s been in wait-and-see ￰5￱ believe the economy is stable, not thriving, but not crashing ￰6￱ data gave no major surprises, just more time for policymakers to figure out what’s coming next.

They’re especially watching Donald Trump’s 15% tariffs on European goods, a spending spree from the German government, and rising bond yields in France triggered by political ￰7￱ dodges details as last rate cut remains in play ECB president Christine Lagarde is not expected to offer clarity about future interest rate decisions during her press conference on later ￰8￱ approach in July was to be, as she put it, “deliberately uninformative,” batting away every question about the direction of monetary ￰9￱ time looks no different, because inflation is likely to fall below the 2% target next year, a development that keeps the idea of a final “insurance” cut on the ￰10￱ at HSBC wrote , “The risk of a more persistent inflation undershooting, which might become evident in December, when the ECB will be forecasting out to 2028, suggests a dovish bias.” But it’s not a big ￰11￱ are only discussing the possibility of one more ￰12￱ agree the major rate moves are ￰13￱ conversation now is about whether that last trim is needed, and ￰14￱ are split, with a 50-60% chance of that final rate drop by ￰15￱ contrast, the ￰16￱ Reserve, under Trump’s leadership, is widely expected to lower rates six times before the end of next ￰17￱ ECB will announce its rate decision earlier in the day, at 1215 ￰18￱ split as trade tension and France raise risks Inside the Governing Council, views on what to do next aren’t ￰19￱ hawks, the group that wants no more easing, argue that the euro zone has handled global headwinds better than ￰20￱ point to stronger industrial activity, higher German government spending, and steady consumer demand as proof that the economy is holding ￰21￱ with Trump’s tariffs landing harder than forecasted, companies across the bloc have adjusted.

A deal has been agreed, and that’s helped lower some of the ￰22￱ Paribas said in a research note, “Our base case remains for the economy to remain resilient, as trade-induced uncertainty recedes and gives way to a more positive impulse from higher European defence and German infrastructure spending.” But that’s just one side of the ￰23￱ doves, those pushing for another rate cut, say the tariffs haven’t fully filtered through the system yet, worried about what happens if growth slows and prices weaken right as inflation dips below ￰24￱ could push firms to lock in lower prices and wages, which risks dragging the euro zone back into the kind of weak inflation environment seen before ￰25￱ people and businesses start believing prices will stay flat, that belief becomes hard to ￰26￱ complication is the Fed’s expected rate cuts could lift the euro’s value, making imported goods cheaper and dragging inflation down ￰27￱ there’s France.

A fresh political mess in Paris has pushed French bond yields sharply ￰28￱ puts extra pressure on the ECB, especially since France’s economy is already weighed down by high public debt and weak ￰29￱ the bank does have tools to respond, they can only be used when borrowing costs rise in a way that’s “unwarranted and disorderly.” Right now, economists say that’s not the ￰30￱ problems in France are real, and that means the ECB has no easy excuse to intervene, at least not ￰31￱ Bybit now and claim a $50 bonus in minutes