ECB's Kazimir Shifts Focus to Gas Prices, Inflation Risk
Kazimir said the energy shock is lasting longer than expected and warned food inflation could also pick up as the ECB weighs further action.
- On Monday, European Central Bank policymaker Peter Kazimir warned that Euro-zone inflation could exceed current projections, citing rising natural gas and power prices as significant concerns.
- Natural gas prices reached a four-year high as European nations delayed filling storage over the summer, hoping the Iran conflict would end and prices would fall sharply.
- Food inflation is also expected to rise, driven by a 'perfect storm' of factors including a European drought, the El Nino weather phenomenon, and soaring diesel and fertiliser costs.
- Financial markets currently see a roughly 60% chance of an interest rate hike at the next ECB meeting on October 29, with further moves fully priced in by year-end.
- "Inflation risks are clearly tilted to the upside," Kazimir said, noting the energy shock has lasted longer than expected and its full consequences have not yet passed through to the economy.
18 Articles
18 Articles
Eurozone inflation could turn out to be higher than previously forecast, with gas and electricity prices becoming an increasingly serious risk, Slovak Central Bank Governor and ECB Governing Council member Peter Casimir said on Thursday. The ECB expectedly raised interest rates for the second time this year at its meeting on Thursday and raised a number of its inflation forecasts. This has fueled expectations in financial markets that there coul…
ECB's PETER Kazimir warns of unexpectedly high inflation in the euro zone due to rising energy and food prices, with further interest rate hikes possible.
ECB's Kazimir shifts focus to gas prices, sees upside inflation risk
The escalation of oil overshadows to a large extent the much more vertical rally that the gas is scored this year. Analysts draw attention to the reasons why Europe, and especially the ECB, "starts to worry more about gas than oil." Read
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