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Pace of ECB Rate Path Jolts Markets With July Hike on Radar

  • Rate path will hinge on projections, Guindos says in interview
  • Wunsch says rate bets may be on low side of what’s needed
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Lagarde: War in Ukraine Stoking Upside Inflation Risks
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The European Central Bank’s first interest-rate increase in more than a decade is potentially just three months away and policy makers may move faster than anticipated after that -- a prospect that’s jolting markets. 

Four officials, including Vice President Luis de Guindos, said in recent days that the ECB may raise its deposit rate from minus 0.5% early in the third quarter after ending asset purchases. The comments reflect growing concerns that inflation -- already nearly four times the 2% goal and rising -- risks getting out of control despite a deteriorating growth outlook.