Keeping European Central Bank interest rates unchanged this week was appropriate after inflation reached its 2% target and uncertainty around US tariffs remained high, according to Governing Council member Joachim Nagel.

The ECB's June estimate showed that higher U.S. tariffs would result in lower growth and - depending on any EU retaliation - lower medium-term inflation in the euro zone. Even the ECB's baseline projection from June, which incorporates 10% tariffs from the United States, saw price growth below 2% over the next 18 months.

There’s little reason for the European Central Bank to lower interest rates further unless the economy suffers a major blow, according to Governing Council member Martins Kazaks.

The ECB has just done something it hasn’t done in over a year: nothing. On Thursday, the European Central Bank decided to keep interest rates unchanged after

European bonds dropped for a third day as traders continued to reduce their bets on a final European Central Bank interest-rate cut this year.