Risks to the euro zone inflation outlook remain balanced as the changes since June broadly offset each other, European Central Bank board member Piero Cipollone said in a newspaper interview.

European Central Bank Executive Board member Piero Cipollone said the economy is sending “conflicting signals” as officials wait for more clarity before taking a fresh view on whether interest rates need to be lowered any further.

Policymakers must remain agile, noting that the stronger euro was having a significant disinflationary effect, Bank of France Governor Francois Villeroy de Galhau said.

European Central Bank policymakers are setting a high bar for an interest rate cut in September and they would need to see a significant deterioration in growth and inflation before backing further easing,

In notes dated July 24, Goldman said it no longer expects the ECB to deliver a rate cut this year, while J.P. Morgan has pushed its rate-cut forecast to October from September previously. On Thursday, the ECB held policy rates unchanged at 2% after having cut interest rates eight times since June 2024.

Markets are pricing in the ECB keeping its deposit rate at 2%, having reduced it by 25 basis points eight times over the last year as inflation cooled and the eurozone’s economic growth struggled for traction.