FRANKFURT, Sept 10 (Reuters) – European Central Bank policymakers expect further policy tightening in the months ahead to fight a war-fuelled rise in inflation and could move again as soon as October, two sources told Reuters.
The ECB raised borrowing costs on Thursday for the second time this year and warned that price pressures could prove lasting, fuelling bets on even more interest rate hikes.
Policymakers are growing more worried about inflation after a sharp rise in gas and oil prices in recent months, which they think may require more higher rates to stop it from spreading to the rest of the economy, the sources said.
They said a move might come at the ECB’s next meeting on Oct 29 although that would entirely depend on incoming data and developments in Iran.
An ECB spokesperson declined to comment.
ECB President Christine Lagarde said during a news conference on Thursday she could not anticipate what the next move may be and reaffirmed the bank’s mantra for “meeting-by-meeting”, “data-dependent” decisions.
(Reporting by Francesco Canepa and Balazs Koranyi)
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