ECB to Raise Interest Rates Again Amid Iran War-Driven Inflation

The European Central Bank (ECB) is expected to raise interest rates on September 10 for the second time in 2026, aiming to combat inflation triggered by the Iran war.

The conflict has led to a surge in oil and gas prices, reviving fears of price hikes in the euro zone. Economists anticipate the ECB will increase its policy rate to 2.50% from 2.25%, signaling a readiness to tighten further if inflation does not improve.

Alessia Berardi, head of global macroeconomics at the Amundi Investment Institute, said: 'A September hike looks all but locked in.' Inflation remains elevated and should stay sticky over the next few months before easing toward the second half of 2027.