ECB leaves interest rates unchanged and keeps an eye on future guidance
The ECB cut interest rates by 25 bps in June, and interest rates have been cut since 2016, but there is a strong view that interest rates will remain unchanged at the 2024/7 Board of Directors meeting.
The main refinancing operation interest rate is expected to remain unchanged at 4.25%, the deposit facility interest rate at 3.75%, and the marginal loan interest rate at 4.5%.
Policymakers are unlikely to show clear guidance, but traders will be watching closely for suggestions regarding additional interest rate cuts.
Central banks are taking a cautious approach and are hesitant to cut interest rates any further until they are confident that inflation will reach 2% of the target by 2025.
Eurozone inflation fell from 2.6% in May to 2.5% in June.
Many investors continue to hold the view that interest rates will be cut by 1/4 point later this year, probably 2 more times in September and December.
Source: European Central Bank
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