Overview
- Policymakers left the deposit rate at 2.0 percent for a sixth straight meeting and kept other key rates unchanged.
- New staff projections lift 2026 euro-area inflation to about 2.6 percent and cut GDP growth to roughly 0.9 percent.
- The ECB links the shift to the Iran conflict and disrupted Strait of Hormuz traffic, with oil and gas reported up about 40–50 percent.
- The Governing Council warns of upside inflation and downside growth risks, pledging readiness to adjust tools without pre‑committing to a rate path.
- Markets and some economists now price a non‑trivial chance of hikes later in 2026, even as February inflation stood at 1.9 percent and the Fed also paused.