ECB Eyes Another Rate Hike Amid Ongoing Inflation Concerns

The European Central Bank (ECB) policymakers anticipated another rate hike after their July meeting, according to the ECB's account of its July gathering released Thursday. The interest rates were held steady at the meeting after raising them in June for the first time in nearly three years to prevent a war-driven increase in energy prices from becoming embedded in the economy.

The meeting account showed policymakers were already planning a future rate increase, potentially as soon as September. While decisions remained data-dependent, another rate hike would likely be necessary unless the inflation outlook improved significantly, the ECB said.

With inflation at nearly 3%, the Iran conflict continuing and the euro zone economy showing resilience, ECB governors were prepared to raise the policy rate again to 2.50% from 2.25% on September 9-10. The central bank added its official communication should not yet commit to a September hike in case the inflation outlook improved.