ECB’s Rehn Says Energy Shock Has Been ‘Cleary Stagflationary’

ECB Governing Council member Olli Rehn said the Middle East conflict is increasing inflation pressures while simultaneously weighing on European economic expansion. The comments imply a more cautious near-term growth outlook as inflation risks rise, which could keep ECB policy bias relatively constrained.

Analysis

ECB Governing Council member Olli Rehn said the Middle East conflict is increasing inflation pressures while simultaneously weighing on European economic expansion. The comments imply a more cautious near-term growth outlook as inflation risks rise, which could keep ECB policy bias relatively constrained.