The European Central Bank is leaving interest rates unchanged as it waits to see the impact of U.S. President Donald Trump’s tariffs on the economy before deciding whether to cut rates again

While annual inflation in the euro area hit the central bank's 2% target last month, traders widely expected a hold in July — in large part due to geopolitical volatility. The U.S. is the EU's biggest bilateral trade and investment partner and the 27-member bloc exported 503 billion euros ($590 billion) in goods to the States last year.

The pace of central bank rate cuts is slowing as early movers near the end of their easing cycles while sticky inflation keeps others cautious.