ECB expects rate hike talks in April with move more likely in June, sources say

The ECB may need to start discussing interest rate hikes in April and could tighten policy at its June meeting unless the Middle Eastern conflict is quickly resolved. That potential hawkish shift raises the risk of higher euro-area rates, pressure on bond prices and a negative impulse for risk assets if geopolitical tensions ease and tightening proceeds.

Analysis

The ECB may need to start discussing interest rate hikes in April and could tighten policy at its June meeting unless the Middle Eastern conflict is quickly resolved. That potential hawkish shift raises the risk of higher euro-area rates, pressure on bond prices and a negative impulse for risk assets if geopolitical tensions ease and tightening proceeds.