ECB raises rates; Lagarde defends decision, citing inflation data and supply shock. Inflation excluding energy/food rose from 2.2% to 2.5%, services up 3.5%. ECB projects inflation 3% in 2026, 2.3% in 2027, 2% in 2028. Growth forecast lowered slightly to 0.8% in June. Lagarde says future tightening depends on incoming data; cannot predict. She stresses digital euro: lower merchant fees, broad use, no foreign control. She notes public debt at 88% of euro‑area GDP, uneven across member states, but not a concern if commitments kept. She warns about AI and cybersecurity risks, calls for international framework. Term ends Oct 2027, may stay on board during turbulence.
© European Central Bank, 2025.
Summary derived from the ECB website (https://www.ecb.europa.eu ).
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