ECB Policymakers Sound Alarm on Inflation Risks Amid Rising Oil Prices

Three European Central Bank (ECB) policymakers have expressed concerns about growing inflation risks in the region. Bundesbank President Joachim Nagel stated that the situation in the Middle East remains 'highly fragile' and uncertain, while Slovenian central bank chief Primož Dolenc noted that inflation risks are to the upside.

The ECB left interest rates unchanged last Thursday but hinted at a possible hike in September due to rising oil prices. Oil prices have returned to around $100 a barrel, exceeding the ECB's baseline scenario outlined in its June projection.

Austrian central bank chief Martin Kocher also weighed in on the situation, suggesting that another rate hike may become necessary if inflation expectations deteriorate.