ECB Policymakers Sound Alarm on Inflation Risks Amid Iran Crisis

European Central Bank (ECB) policymakers have expressed concerns about growing inflation risks, citing the ongoing Iran crisis as a major threat to economic stability.

The ECB left its key deposit rate at 2.25% after recent surveys and data showed higher fuel costs from the Middle East were not yet spreading broadly to consumer prices, wages, and long-term expectations.

Bundesbank President Joachim Nagel said the situation in the Middle East remains 'highly fragile' and that intense uncertainty persists.

Austrian central bank chief Martin Kocher suggested a rate hike may become necessary but was unclear whether it would happen in September.