The European Central Bank (ECB) left interest rates unchanged at its October 2026 meeting, as expected, keeping the main refinancing rate at 2.65% and the deposit facility rate at 2.50%. Policymakers maintained a wait-and-see approach amid rising inflation risks and the lingering effects of previous monetary tightening. The ECB warned that rising energy prices pose upside risks to inflation and downside risks to economic growth. While underlying inflation has remained broadly stable and wage growth has yet to show a significant response, a prolonged energy shock could intensify price pressures through indirect and second-round effects while weighing on economic activity. Policymakers offered no clear guidance on the future rate path, noting that higher borrowing costs, and fiscal concerns across Europe could further dampen growth and inflation.