Group 1 - The European Central Bank (ECB) is prepared to lower key interest rates again if necessary, according to ECB Governing Council member and Bank of France Governor Villeroy [1] - Despite maintaining interest rates after the recent ECB meeting, Villeroy emphasized the need for policymakers to remain "flexible" due to the strong euro causing significant deflationary effects [1] - The expectation of a trade agreement with the U.S. may lead to a 15% base tariff on exported goods to avoid a 30% tariff that is set to take effect on August 1 [1] Group 2 - The euro/dollar exchange rate is currently in a moderate upward channel, with resistance at around 1.1850 and support near 1.1650 [2] - The euro has formed a complete upward trend since the low of 1.1065, reaching a peak of 1.1829 in early July, followed by a stabilization after a pullback to 1.1556 [2] - Technical indicators suggest that while the overall daily structure is bullish, short-term fluctuations may occur at high levels [2]

Core Viewpoint - The European Central Bank (ECB) can delay its final interest rate cut until December without worrying about premature market assumptions regarding the end of the easing cycle [2][3] Group 1: Interest Rate Outlook - Most respondents expect the deposit rate to be reduced by 25 basis points to 1.75% in September, while half of the economists believe that even if the ECB maintains rates in the following three meetings, traders will not immediately conclude that rates have bottomed out [2] - Approximately one-quarter of respondents believe the ECB has ended its rate-cutting cycle, while nearly half predict the last cut will occur in September, and 21% expect it to wait until December [3] - The ECB is currently in a wait-and-see mode, with expectations for further easing in September and December [3] Group 2: Trade Policy and Economic Conditions - The progress of EU-US trade negotiations is a critical observation point that could disrupt the balance between domestic and external demand [4] - The ECB will be unable to signal whether further rate cuts are necessary or if the terminal rate has been reached before the upcoming meetings due to the lack of a trade agreement [4] - The ECB's June forecast indicated inflation stabilizing at 2% by 2027, with an average of only 1.6% expected for the following year [4] Group 3: Currency and Inflation Concerns - The euro has appreciated nearly 12% against the dollar this year, with ECB Vice President Luis de Guindos warning that if the exchange rate exceeds 1.20, the economy may face challenges [5] - Economists show a higher tolerance for exchange rate pain points, with only about one-quarter agreeing with de Guindos' view, while others believe the warning threshold could be as high as 1.35 [6] - There are concerns that increased public spending may keep core inflation above target levels, and the ECB should not assume that core inflation will easily return to the target range [6]