ECB expected to raise interest rates to 2.5% amid rising inflation

European Central Bank interest rate hike Eurozone inflation monetary policy energy prices

The European Central Bank (ECB) is widely expected to implement its second interest rate hike of the year this coming Thursday, with a projected increase of 25 basis points to bring the deposit facility rate to 2.5%. This move comes as Eurozone inflation rose to 3.3% in August, up from 2.9% in July, marking the fastest pace in nearly three years.

Policymakers are facing renewed inflationary pressures driven by rising energy costs, including natural gas prices via the TTF benchmark which exceeded 70 euros per megawatt-hour last week. Geopolitical tensions in the Middle East continue to impact fuel costs. While some economists view the upcoming hike as a final step for now, analysts at JPMorgan, Societe Generale, and BNP Paribas have updated their forecasts to suggest a potential third rate hike in December.

Deutsche Bank Research has also projected two additional hikes by the end of the year, which could potentially bring the deposit rate to 2.75% in December. Meanwhile, the ECB is also considering a discussion regarding increasing the minimum reserve requirement for banks from one to two percent, a move that the German banking industry warns could increase credit costs.

Entities

Christine Lagarde · Deutsche Bank · European Central Bank · Eurostat · Eurozone · Isabel Schnabel · JPMorgan · Joachim Nagel · Société Générale · Strait of Hormuz

Claims

What the coverage asserts, and how many sources carry each claim.

[● 32 SOURCES] Eurozone inflation rose to 3.3% in August from 2.9% in July, according to Eurostat. athina984.gr · www.newsit.gr · www.ieidiseis.gr · www.madata.gr · www.newmoney.gr · +21 more
[● 23 SOURCES] This will be the second rate hike of the year, following an increase in June. athina984.gr · www.newsit.gr · www.ieidiseis.gr · www.madata.gr · www.newmoney.gr · +13 more
[● 33 SOURCES] The ECB is expected to raise the deposit facility rate by 25 basis points to 2.5% next Thursday. athina984.gr · www.newsit.gr · www.ieidiseis.gr · www.madata.gr · www.newmoney.gr · +21 more
[● 26 SOURCES] European natural gas (TTF) prices surpassed 70 euros per megawatt-hour last week. athina984.gr · www.newsit.gr · www.ieidiseis.gr · www.madata.gr · www.newmoney.gr · +16 more
[● 27 SOURCES] ECB Executive Board member Isabel Schnabel warned that inflation may remain above the 2% target for an extended period due to energy price impacts from Middle East tensions. athina984.gr · www.newsit.gr · www.ieidiseis.gr · www.madata.gr · www.newmoney.gr · +17 more
[● 2 SOURCES] Bundesbank chief Joachim Nagel described the upcoming rate hike as relatively foreseeable. www.cash.ch
[● 8 SOURCES] Analysts at JPMorgan, Societe Generale, and BNP Paribas have updated their forecasts to suggest a potential third rate hike in December. www.alborsaanews.com · www.sadanews.ps · www.europesays.com · www.cash.ch · www.sbctv.gr · +2 more
[○ 1 SOURCE] ECB Executive Board member Isabel Schnabel warned that inflation could remain above the 2% target due to energy price impacts. greekcitytimes.com
[● 6 SOURCES] The ECB is expected to raise the deposit facility rate by 0.25 percentage points to 2.5% next Thursday. www.alborsaanews.com · www.sadanews.ps · www.europesays.com · www.cash.ch · greekcitytimes.com · +1 more
[○ 1 SOURCE] European natural gas prices via the TTF benchmark exceeded €70 per megawatt-hour last week. greekcitytimes.com
[● 13 SOURCES] Eurozone inflation rose to 3.3% in August, up from 2.9% in July. www.alborsaanews.com · www.sadanews.ps · www.europesays.com · greekcitytimes.com · www.thejournal.ie · +8 more
[● 20 SOURCES] The three-month Euribor rose to 2.65% from 2.46% in early August and 2.31% in early July. www.dimokratia.gr · www.kapa-news.gr · www.sbctv.gr · www.eea.gr · emvolos.gr · +11 more