18.12.202513:28:47UTC+00Euro Pares Losses After ECB Decision

The euro reduced its losses, settling around $1.1733, following the European Central Bank's (ECB) decision to keep interest rates unchanged. This outcome, which was widely anticipated, provided little guidance for the markets. ECB policymakers deemed the current interest rates as largely neutral, indicating they are neither promoting nor hindering economic activity. They reaffirmed a flexible approach to future rate changes, relying on data and assessing conditions at each meeting without committing to a predetermined rate trajectory. According to the latest ECB staff projections, inflation is expected to remain close to the 2% target. The forecasts predict headline inflation at 1.9% in 2026, 1.8% in 2027, and 2.0% in 2028, while core inflation is anticipated to slightly fall below 2% in 2027. Economic growth projections have been adjusted upwards, driven by domestic demand, with GDP growth estimated at 1.4% in 2025, 1.2% in 2026, and maintaining 1.4% through 2028.