The European Central Bank (ECB) is expected to lower its key interest rate by 0.25% on Thursday, bringing the deposit facility rate to 2%. This follows inflation falling to around the 2% target and sluggish economic growth. While analysts predict further rate cuts later in the year, the ECB is unlikely to offer clear guidance on future policy. Uncertainty surrounding US tariffs and the EU's own economic plans contributes to this cautious approach. The ECB will also release its latest staff projections this week, outlining inflation and growth expectations.

Prepared by Christopher Adams and reviewed by editorial team.