ECB Governing Council member and Bundesbank president Joachim Nagel said the ECB
will raise rates next week but remains cautious about subsequent hikes. In a
Wednesday interview he said markets currently assign a better-than-95%
probability to a rate increase at the September meeting and that market pricing
is broadly accurate. He declined to provide guidance beyond the September
meeting, citing volatile oil and gas prices, turbulent financial markets and
high uncertainty. Inflation remains far above the medium-term target; June
projections show inflation would only return to 2% in the medium term if rates
are higher.
