ECB Holds Rates at 2.25% as Falling Inflation Gives Way to September Hike Bets
Updated
Updated · ING Think · Jul 23
ECB Holds Rates at 2.25% as Falling Inflation Gives Way to September Hike Bets
3 articles · Updated · ING Think · Jul 23
Summary
The ECB left its key rates unchanged, keeping the deposit rate at 2.25% after June’s increase despite rising energy prices.
Headline inflation has eased, knock-on effects from higher energy costs remain limited, and the eurozone economy has so far absorbed the oil shock relatively well.
Energy prices are still pushing the outlook toward the ECB’s harsher scenarios, making a September rate hike look increasingly likely unless oil prices retreat sharply in coming weeks.
The hold also reflects the ECB’s reluctance to surprise markets, with investors now watching Christine Lagarde’s press conference for signals on whether September tightening is being prepared.