The European Central Bank kept its key deposit rate unchanged at 2.25 percent and said it was "closely monitoring" the inflationary impact of fresh conflict in the Middle East. "The Governing Council is therefore closely monitoring the intensity and duration of the shock." “With today’s decision, the Governing Council remains well positioned to navigate the uncertainty caused by the conflict.” The euro extended its overnight weakness against the dollar......and Bund yields remained elevated...For now, traders are largely unmoved on the future ECB rate trajectory, holding around 48bps of hikes by year-end. Rather, he says it’s a hold while the central bank updates forecasting before hiking in September.