ECB executive board member Rehn said energy prices are approaching the adverse scenario the ECB models, but sharply higher long-term borrowing costs are limiting how much this bout of inflation can pass through to the broader economy. Eurozone inflation is about twice the ECB target, keeping pressure on the bank to consider further hikes. Rehn said inflation risks remain skewed to the upside but are two-sided and that growth and inflation forecasts carry very high, broad uncertainty. He also war

ECB executive board member Rehn said energy prices are approaching the adverse scenario the ECB models, but sharply higher long-term borrowing costs are limiting how much this bout of inflation can pass through to the broader economy. Eurozone inflation is about twice the ECB target, keeping pressure on the bank to consider further hikes. Rehn said inflation risks remain skewed to the upside but are two-sided and that growth and inflation forecasts carry very high, broad uncertainty. He also warned that lending to technology firms could pose financial-stability risks, saying large valuation corrections tied to AI could propagate through equity and credit markets.