Eurozone inflation data and rising oil prices above $90 keep a potential September ECB rate hike alive despite a pause today.
The European Central Bank left interest rates unchanged today, aligning with widespread expectations as inflation moderated in June. Services inflation and wage growth softened, while business surveys signaled sluggish economic activity, reducing immediate pressure for further tightening.
Recent comments from ECB policymakers have struck a cautious tone, acknowledging upside risks from higher oil prices but noting the absence of sustained wage pressures. The central bank will not release updated macroeconomic projections at this meeting, shifting focus to President Lagarde’s press conference for hints on future moves.
Oil prices climbing above $90 per barrel amid geopolitical tensions in the Strait of Hormuz have reintroduced inflation risks, keeping a September rate hike on the table if data surprises to the upside.