ECB Hikes Rates as Middle East Conflict Drives Energy Inflation

The European Central Bank (ECB) has increased its benchmark deposit rate by 25 basis points to 2.50%, in response to a sharp resurgence in energy-driven inflation caused by the escalating military conflict between the United States and Iran in the Middle East.

This move, announced after the Governing Council's meeting on September 10, 2026, marks the second rate hike of the year and reflects the central bank's growing concern over prolonged price pressures.

The ECB has also raised the interest rates on main refinancing operations and the marginal lending facility to 2.65% and 2.90%, respectively, effective September 16, 2026.