Cyprus central bank chief warns ECB against rushing interest rate hikes

The European Central Bank should not rush to raise rates in response ​to surging energy costs, as its “baseline” outlook remains intact and there is no sign yet that ‌inflation is becoming entrenched, Cypriot central bank chief Christodoulos Patsalides said.

With energy prices surging on the US-Israeli war with Iran, euro zone inflation is set to breach the ECB’s 2 per cent target as early as this month, prompting policymakers to debate whether to raise interest rates to head ​off second-round effects.