Bundesbank Chief Says ECB Rate Hikes Depend on Energy Prices
Joachim Nagel, President of the Bundesbank, stated that future European Central Bank (ECB) interest rate decisions will largely depend on developments in energy prices. Speaking to CNBC after a recent quarter-point hike bringing rates to 2.5%, Nagel noted that current levels are at the upper end of neutral territory and could move into mildly restrictive territory if needed. Nagel emphasized uncertainty around future hikes, citing volatility in oil prices which recently climbed above $100 per barrel. He also mentioned elevated European gas prices but expressed confidence about winter energy supply due to improved LNG options compared to 2022-23 crisis levels.
