ECB President Lagarde confirms unanimous decision to pause rate hikes but acknowledges calls for further tightening amid inflation risks.
The European Central Bank left its key interest rates unchanged at its July meeting, citing sufficient policy positioning to wait for incoming data. The decision was unanimous among Governing Council members, though some questioned whether a rate hike should be considered to address inflation risks.
Lagarde emphasized the ECB’s focus on second-round effects and wage trends, noting a gradual decline in wages but no evidence of persistent inflationary pressures yet. The central bank will review fresh economic data ahead of its September meeting but provided no forward guidance on future moves.
Markets reacted cautiously as the ECB maintained a data-dependent stance, balancing inflation concerns against economic growth risks. The euro showed limited movement following the announcement.