European Central Bank (ECB) Governing Council member Joachim Nagel has signaled that further interest rate hikes are likely on the horizon. Speaking on Friday, Nagel emphasized the upward pressure on consumer prices, suggesting that borrowing costs may need to rise to combat inflation.
“If the situation stays as it is, it seems highly probable that we’ll have to act again,” Nagel stated during his speech. He warned that prolonged elevated inflation increases the risk of second-round effects, which could further complicate economic stability.
As the Bundesbank president, Nagel’s remarks carry significant weight, particularly as the ECB continues to navigate the delicate balance between controlling inflation and supporting economic growth. His comments reflect a growing consensus among policymakers that additional measures may be necessary to curb rising prices.