ECB policymakers signal further tightening, October move possible
ECB policymakers expect more policy tightening in the months ahead and could act again as soon as October, sources say, after this week's second rate rise of the year.
European Central Bank policymakers expect to tighten monetary policy further in the coming months as they confront inflation driven higher by the war in Ukraine, and a fresh move could come as early as October, according to people familiar with the discussions.
The central bank raised borrowing costs on Thursday for the second time this year and cautioned that price pressures may prove persistent, a combination that has strengthened market expectations of additional rate increases.
According to the sources, policymakers are growing more concerned about inflation following a steep climb in gas and oil prices in recent months. They believe further rate rises may be needed to prevent those cost pressures from spilling over into the wider economy.
A move could come at the ECB's next meeting on October 29, the sources said, though any decision would depend entirely on incoming economic data and on developments in Iran.
An ECB spokesperson declined to comment on the internal deliberations.
Speaking at a news conference on Thursday, ECB President Christine Lagarde said she could not predict the central bank's next step. She restated the bank's position that decisions would be taken meeting by meeting and would depend on the data available at the time.