ECB Cautious on Further Rate Hikes Amid Rising Inflation Risks

Bank of Greece Governor Yannis Stournaras has cautioned the European Central Bank (ECB) against rushing into further interest rate hikes, citing rising inflation risks. In a Bloomberg TV interview in Dublin, Stournaras expressed concern that higher inflation had not yet triggered significant wage-related effects, but warned that the trend could change.

The governor pointed to repeated supply shocks, strong demand driven by fiscal expansion, and a surge in artificial intelligence investment as reasons for continued vigilance. ECB officials are weighing their next steps after raising borrowing costs twice since the outbreak of the pandemic.