ECB Expected to Raise Rates Again in September as Iran War Keeps Inflation Elevated

TLDR

• The ECB held rates steady at its July meeting but called it a “pause,” not the end of rate hikes
• Policymakers said another rate increase would likely be needed unless inflation improved
• Sources say ECB governors are ready to raise the policy rate to 2.50% from 2.25% in September
• Inflation in the euro zone is running at nearly 3%, driven partly by the ongoing Iran conflict
• Corporate lending in the euro zone grew at its fastest pace in over three years in July

The European Central Bank paused its rate hike cycle in July but made clear it was not finished raising borrowing costs. Meeting minutes released Thursday show policymakers were already planning for another increase, possibly as soon as September.

ECB SET FOR SEPTEMBER RATE HIKE

ECB policymakers are prepared to raise rates by 25 basis points to 2.50% in September, Reuters reports, as the Iran war keeps energy prices and inflation elevated.

Euro-zone inflation is near 3%, while economic activity remains resilient.…

- *Walter Bloomberg (@DeItaone) August 25, 2026

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