FX.co ★ ECB Expected to Maintain Policy Rates

The European Central Bank (ECB) is anticipated to maintain its current interest rates for the second consecutive meeting on Thursday. This decision reflects a careful "wait-and-see" strategy due to stable inflation, a robust economic environment, and uncertainties surrounding trade policies. The main refinancing rate is expected to remain at 2.15%, with the deposit facility rate holding steady at 2%. Investors will closely scrutinize the ECB Staff Macroeconomic Projections released post-meeting, as they will offer updated insights into growth and inflation forecasts. Between June 2024 and June 2025, the ECB reduced borrowing costs by 200 basis points before pausing in July. Currently, markets predict that the rates will stay unchanged until the end of the year, with a possibility of tightening in late 2026. Meanwhile, Eurozone growth is forecast to be 1.2% for this year, 1.1% in 2026, and 1.4% in 2027. However, political instability in countries such as France and Spain could potentially impact these projections.