A Governing Council member signals potential rate hikes if rising oil prices destabilize inflation expectations in the eurozone.
The European Central Bank could increase interest rates if surging oil prices lead to a deterioration in inflation expectations, according to a Governing Council member. Martins Kazaks noted that higher oil costs are beginning to push inflation upward, posing risks to price stability.
Recent trends show oil prices climbing, which may impact broader inflation metrics. The ECB has previously emphasized the need to anchor inflation expectations, with prior rate decisions aimed at curbing persistent price pressures.
EUR/USD remained slightly lower on the day, trading near the 1.1700 level, reflecting cautious market sentiment amid the comments.