ECB Maintains Rates Steady; Inflation Eases to 1.7% as Lagarde Stresses Data-Driven Approach

The European Central Bank maintained基准 interest rates unchanged on February 03, 2026, as President Christine Lagarde said inflation is “in a good place” despite easing to 1.7% in January 2026 from 2.0% in December, driven largely by a -4.1% year-on-year drop in energy prices. Core inflation eased to 2.2%, its lowest since October 2021, while services inflation slowed to 3.2%. Lagarde stressed a data-dependent, meeting-by-meeting approach, downplaying a “one data point” narrative and signaling no immediate hawkish tilt. Eurozone GDP rose 0.3% in Q4 2025, led by ICT and AI sectors; food inflation edged up to 2.7%. Unemployment declined to 6.2% in December. The ECB will send a reform “checklist” to EU leaders ahead of the Competitiveness Council on February 12, urging progress on banking and capital markets unions, the digital euro, strategic autonomy, and other structural reforms.