Nagel Says ECB Rate Path Hinges on $110 Oil After 25-Basis-Point Hike
Updated
Updated · CNBC · Sep 11
Nagel Says ECB Rate Path Hinges on $110 Oil After 25-Basis-Point Hike
3 articles · Updated · CNBC · Sep 11
Summary
Joachim Nagel said the ECB will decide on any further rate increases based on how energy prices evolve over the next month, after Thursday’s quarter-point hike lifted the key rate to 2.5%.
Oil was the immediate concern: Nagel said crude had climbed close to $110 a barrel after sharp volatility, while Brent and WTI both stayed above $100 and Dutch TTF gas hit its highest since 2022.
Nagel said rates are now at the upper end of neutral territory but did not rule out moving into mildly restrictive territory, adding it was too early to judge whether one or two more hikes would be needed.
On winter risks, he said Europe’s relatively low gas storage was not comparable to the 2022-2023 energy crisis because the region now has more options to buy LNG.