Overview

• The European Central Bank left the deposit rate at 2.0%, marking a second straight pause after eight cuts since mid‑2024.
• Eurozone inflation printed 2.1% in August with core at 2.3%, and the ECB lifted its 2025 growth forecast to 1.2%.
• Christine Lagarde highlighted unsettled prospects from trade tensions and France’s political crisis and declined to comment on individual countries.
• Speculation about potential TPI bond purchases resurfaced as French spreads widened, though officials stressed strict conditions and Fitch reviews France on Friday.
• Markets largely expect no further moves this year with roughly a 50% chance of a cut by July 2026, while average retail deposit rates edged up to 1.28%.