Economists Foresee ECB Rate Hike in June, Survey Shows

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A Bloomberg survey indicates that the European Central Bank will raise interest rates in June, as the conflict involving Iran is expected to drive inflation higher this year. However, the same survey, conducted from April 9 to 15, suggests that the anticipated 0.25 percentage point increase may be a one-time adjustment, as the conflict is not projected to cause a lasting price shock. The inflation rate for this year is now forecast to accelerate to 2.8%, up from a previous prediction of 2%. Insiders reveal that ECB officials are currently leaning toward maintaining the status quo at their upcoming meeting in late April. Nevertheless, some officials, including Bundesbank President Joachim Nagel, have indicated that a rate move at that time cannot be ruled out. In the previous survey conducted before the ECB's March meeting, economists had predicted the central bank would not respond to the conflict. In contrast, investors have been anticipating more assertive action, currently betting on two rate increases within the year.

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