Informed sources indicate to Bloomberg that the ongoing discussions within the European Central Bank tend towards stabilizing interest rates this month. It seems that the bank prefers to wait before taking any steps in light of the need to evaluate the impact of the Iranian war on inflation rates and economic growth.
This trend reflects a growing conviction that the information currently available is insufficient to accurately judge the size of the economic impact of the ongoing conflict, especially with the continuation of peace talks and the decline in energy prices after recent rises.
Statements issued by officials at the European Central Bank and the International Monetary Fund have contributed to strengthening this cautious approach. In addition, Goldman Sachs revised its previous rate hike forecast for April, indicating that pressing pressures to tighten monetary policy have eased for now.
In a related context, an opinion poll showed expectations that the European Central Bank will raise interest rates during its meeting scheduled for next June, in light of the impact of the Iranian war on increasing inflation rates during the current year.
According to the survey conducted by Bloomberg from April 9 to 15, the bank is likely to raise interest rates by a quarter of a percentage point, with expectations that the conflict will not cause a long-term price shock.
The inflation rate is expected to rise to 2.8% in 2026, compared to previous expectations of 2%. However, inflation is expected to return to decline this year to reach 2.1%, and then continue to decline during 2027 to reach the European Central Bank’s target rate of 2%.
