The European Central Bank is expected to leave its key interest rates unchanged when its Governing Council wraps up its July 23 meeting in Frankfurt. Analyst consensus is unanimous, and financial markets are pricing less than a 5% chance of any rate move. ING THINK. The decision is due at 14:15 CET, with President Christine Lagarde's press conference following at 15:00 CET.

A basis point is one one-hundredth of a percentage point, so 25 basis points equals a quarter of a percentage point. That matters here because the ECB raised all three of its key rates by 25 basis points just six weeks ago, at its June meeting. That brought the deposit facility — the rate banks earn for parking cash at the ECB overnight — to 2.25%, the main refinancing rate (the cost of borrowing from the ECB for one week) to 2.40%, and the marginal lending facility (overnight emergency borrowing) to 2.65%. ECB. The June hike was unanimous, with all Governing Council members backing the increase proposed by Chief Economist Philip Lane. ING THINK.

That June move was no shock to markets. Going into the meeting, the euro had already reflected expectations of a rate hike, with the 25bp deposit-rate increase to 2.25% baked into prices. ING THINK. The broader trajectory has been steep in both directions. The ECB cut rates four times in the first half of 2025, bringing the deposit rate down from 3% at the start of the year to 2% by mid-2025. CNBC. The June 2026 hike partially reversed that easing cycle.

Looking ahead, analysts expect the ECB to raise rates again in September 2026 before pausing for the rest of the year. Morningstar. ING's THINK platform, in its July 2026 review of major central banks, noted the ECB still looked set to hike again. ING THINK. That aligns with the platform's March analysis, which flagged that an ECB hike was already priced in by July and that the ECB's own December staff projections included one rate cut for 2026. ING THINK.

Despite the overwhelming consensus for a hold this week, ING's ECB preview noted that renewed Middle East tensions could still justify a surprise hike at the July meeting. ING THINK. That is an outside risk. With markets assigning under 5% probability to any rate move, the Governing Council would need a compelling, real-time reason to deviate from the expected path.

The rate-setting picture is worth laying out precisely. The ECB's deposit rate sat at 2% after the mid-2025 easing cycle. The June hike added 25bp, bringing it to 2.25%. A further September hike, if it happens, would push the deposit rate to 2.50% — the second hike of 2026, further unwinding the aggressive cuts delivered in the first half of the year. Whether that pace continues into year-end depends on inflation data and the geopolitical picture between now and September.

The broader context here is that for anyone watching markets, the rate decision on July 23 is effectively locked in. The real signal to watch is the forward guidance — the ECB's communication about where rates are heading — and any shift in tone from Lagarde at the press conference. A September hike is the base case across analyst desks, but whether the ECB frames that path as conditional on upcoming data or more firmly committed will shape how short-term interest rate expectations get priced. The June minutes already revealed unanimity around Lane's proposed hike, suggesting the Council is aligned. Any crack in that alignment would be the genuine surprise.

The accounts of the July 23 meeting will be published in the standard timeframe, roughly four weeks after the decision, per ECB convention.