ECB Holds Steady on Rates Amid Global Trade Tensions

The European Central Bank (ECB) chose to maintain interest rates unchanged on Thursday, following eight consecutive rate cuts over the past year. This decision comes as trade negotiations between Brussels and Washington near completion, with both parties addressing potential tariffs on goods.

Inflation has settled at a target rate of 2%, prompting the ECB's Governing Council to take a cautious approach, considering the economic uncertainties posed by international trade disputes. Recent reports suggest a potential agreement between the EU and the U.S., which may soften tariff impacts and support economic growth across the eurozone.

While there's optimism for economic acceleration, the risk of increased tariffs looms, which could affect growth. Money markets are still anticipating potential rate cuts by March. ECB President Christine Lagarde is expected to be reassuring, emphasizing the bank's focus on managing any inflationary impacts from currency appreciation or tariff changes.

(With inputs from agencies.)