According to Jinshi Data, the European Central Bank may maintain the 2% interest rate unchanged in its last decision before the summer break to address the economic risks posed by Trump’s tariffs. Policymakers are aware of the lurking risks, as a stronger euro suppresses price prospects and squeezes exporters, while France's public finance issues could trigger a political crisis.
Morgan Stanley economists point out that President Lagarde may reiterate in her statement that the risks to growth 'tend to be on the downside.' The wording following the meeting on July 24 is expected to be similar to June, leaving open the possibility for further rate cuts, but without making any commitments.
