REVIEW: ECB Keeps Rates Unchanged In July, and Prepares For a Hike In September

In this paper, we discuss:

• Why the ECB kept interest rates unchanged while reinforcing its data-dependent policy approach.
• How renewed energy price pressures and geopolitical risks are increasing the likelihood of a September rate hike.
• Why President Lagarde adopted a more hawkish tone despite softer recent inflation data.
• How the ECB is balancing improving economic activity against persistent inflationary risks and elevated uncertainty.
• Why markets are increasingly pricing further monetary tightening despite the ECB’s decision to pause in July.

Download PDF: ECB Review – July 2026