The Middle East conflict drives up inflation, and the European Central Bank may "hold steady" until the final interest rate hike in December

Affected by the rise in oil and gas prices due to the Middle East conflict and the warming inflation expectations, the market anticipates that the European Central Bank will skip the interest rate hike in October and instead implement the last rate hike of this round in December, with the deposit rate expected to be raised to 2.75%. Although analysts previously predicted September as the endpoint, the recent upward revision of inflation forecasts supports further tightening of policies. Officials stated that actions may be taken at each meeting during uncertain times, and investors are betting on at least three more rate hikes, expecting rates to remain until the end of 2027 before starting to decrease