FX.co ★ ECB Keeps Rate Path Open Amid Inflation Uncertainty: Minutes

At their September meeting, when they implemented the first rate increase since 2023, ECB policymakers judged inflation risks to be tilted to the upside. However, they emphasized the need to avoid signaling any future policy moves and to keep all options open, according to the meeting accounts published on Thursday. Officials cautioned that inflation in the euro area could exceed current projections, but underlined the importance of refraining from giving guidance on the future interest-rate path, given the high degree of uncertainty surrounding the inflation outlook and the wide range of possible scenarios stemming from ongoing hostilities between the US and Iran, as well as Russia’s war in Ukraine. The ECB also noted that while policy action should remain proportionate, the 2.50% deposit rate was still within staff estimates of the neutral range.