The the European Central Bank kept interest rates unchanged at 2.25%, as was widely expected. Policymakers raised borrowing costs by a quarter of a point in June, having decided it was time to start trying to curb inflation.
The latest flare-up in fighting between the U.S. and Iran didn't force the ECB's hand on Thursday, even as energy costs creep higher.
Euro zone inflation cooled to 2.8% last month from 3.2% in May, which has weakened the case for Frankfurt to carry on hiking rates.
Still, there was a case for the ECB to be proactive.
The U.S. has launched attacks on Iran for 11 straight days, disrupting shipping through the Strait of Hormuz and sending oil prices to their highest level in more than a month.
Investors are worried that the fracturing of the cease-fire between the two countries will encourage central banks to tighten, which has weighed on U.S.-listed tech stocks in recent trading sessions.
Write to George Glover at george.glover@dowjones.com
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(END) Dow Jones Newswires
July 23, 2026 08:16 ET (12:16 GMT)
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