Highlights

  • The ECB maintained rates at current level, staying in a vigilant mode.

  • The ECB raised inflation forecasts for this year and the next, while lowering 2026 growth.

  • With growth affected by tariffs, the ECB remains data dependent and open to possible further cuts later in 2025/early 2026.

ECB left rates steady in September

In this edition

The ECB kept policy rates unchanged at its September meeting, emphasising a data-dependent approach before deciding on further rate cuts.

The central bank raised its forecast for economic growth this year and noted that growth has been resilient so far due to domestic demand and labour markets. Secondly, the bank expects that consumer spending and investments could get a boost from rate cuts already implemented. Importantly, the ECB slightly downgraded its expectations for growth in 2026, hinting some growth concerns beyond this year.

We would like to emphasise that, while the US-EU agreement has reduced some uncertainty on trade, tariffs on EU exports remain higher than they were previously. As a result, these could affect the region’s growth, underlining the need for further monetary easing.

Key dates

 

15 Sep

China industrial production, retail sales and fixed asset investment
 

 

 

17 Sep

Fed interest rates decision, UK inflation, US housing starts and building permits 
 

 

19 Sep

MoM BoJ interest rate decision, Japan inflation rate 

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