The European Central Bank is expected to avoid delivering another interest-rate increase in the coming week, but policymakers are still seen as leaving the door open to a move in September. That stance reflects a balancing act between signs of easing price pressures and continued concern that inflation risks have not fully disappeared.
Investors and economists are watching for how the ECB frames its next decision. Even if rates are left unchanged for now, the message is likely to stress flexibility and caution, with officials seeking to preserve room for tighter policy if incoming figures show inflation remains too strong.
Upcoming economic releases are set to play a major role in that outlook. Public finance numbers, labor market updates and wage data are all due, followed by inflation readings that are expected to show some moderation. Those reports could help determine whether a pause becomes a longer break or simply a delay before another increase.
The broader backdrop remains uncertain, with war-related risks still weighing on the economic outlook. For the ECB, that means policy is likely to stay data-dependent, with the possibility of another rate hike still firmly on the table for September.
