ECB Seen Hiking Rates in September, Risks Lurk Amid Oil Price Uncertainty

Nomura's Global Markets Research team expects the European Central Bank to raise its deposit rate by 25 basis points to 2.50% at its September 10 meeting, with no further hikes anticipated afterwards.

The analysts point to rising price pressures and the euro area's economic resilience as reasons for a September rate hike, which they see as robust under all scenarios.

However, risks are skewed towards further tightening if Brent crude oil prices stay elevated, particularly above $100 per barrel, which could prompt the ECB to bring forward its December 2026 hike to October.