The ECB’s cautious stance signals a patient approach to monetary tightening amid inflation concerns. While the bank remains alert to inflation risks, it is waiting for a substantial data set before adjusting rates. This suggests limited immediate upside pressure on the euro, as markets price in only a 20% chance of a rate hike in April, rising to 70% by June. Traders should monitor upcoming economic releases closely, as the ECB’s future moves hinge on persistent inflation trends. The prospect of two hikes by year-end keeps the euro supported in the medium term, but short-term volatility may be muted given the central bank’s measured tone.