ECB's Schnabel Warns of Rate Hikes If Energy Shocks Expand, Citing Inflation Risk

According to ECB Executive Board member Isabel Schnabel on Thursday, the European Central Bank will need to raise interest rates if energy shocks expand and threaten medium-term price stability. Speaking at an event in London, Schnabel noted that risks have increased in recent weeks as supply disruptions become more frequent. She emphasized that with inflation currently at 3%, the central bank must tighten monetary policy to prevent second-round inflation effects, particularly as businesses accelerate price increases and households adjust expectations.
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