Ebury head of market strategy Matthew Ryan said rising gas prices amid
escalating US-Iran tensions, together with Eurozone inflation unexpectedly
rising to 3.3% in August, make an ECB rate hike in September near-certain. He
noted core inflation fell to 2.4% in August from 2.5% in July—back to February
levels before the Iran conflict—and said there is still little evidence energy
price gains are passing through to core inflation. Ryan warned that while a
September looks likely, further moves to push rates into restrictive
territory are far from certain, which could limit EUR/USD upside given markets
have already priced in aggressive additional tightening.
