ECB Maintains Steady Policy Amid Inflation Stability and Economic Uncertainties

The European Central Bank remains confident in its current monetary policy as inflation stabilizes NEAR the 2% target. ECB officials, including Governor Vujcic, emphasize the appropriateness of holding interest rates steady for the third consecutive meeting, balancing inflation control with economic growth.

President Christine Lagarde acknowledged the eurozone's progress while navigating global geopolitical tensions. The ECB's strong policy stance appears resilient, though officials monitor potential risks including fiscal discipline concerns and overpriced markets.

Retail fund outflows surpassing hedge fund redemptions raise particular concerns. "That's usually a sign that something's coming that's not very good," Vujcic warned, though he maintains the bank's position remains well-calibrated.

With Q3 GDP exceeding expectations and new quarterly estimates due in December, analysts see only a 40% chance of rate cuts by mid-2026. The deposit rate holds at 2% following eight previous reductions.