Euro Rebounds as ECB Leaves Door Open for Hikes

2026-05-01 08:25 By Joana Ferreira 1 min. read

The euro traded above $1.17 in early May, recovering from three-week lows, as investors analyzed the European Central Bank’s latest policy decision and a fresh rise in oil prices amid Middle East tensions.

The ECB held rates steady but kept options open for June and beyond, noting heightened inflation risks and growth concerns.

At the press conference, ECB President Christine Lagarde confirmed the decision to hold rates was unanimous, though a hike had been discussed.

Meanwhile, ECB official Joachim Nagel cautioned that the central bank might need to tighten policy as early as June, citing a worsening inflation outlook and the risk of persistent price growth.

Fellow official Madis Müller also signaled that rates could require an increase.

Market expectations now include three rate hikes in 2026, with the first fully priced in by July.

Adding to the upward push, Brent crude prices climbed further after US President Donald Trump maintained the naval blockade of Iranian ports.



News Stream
Euro Rebounds as ECB Leaves Door Open for Hikes
The euro traded above $1.17 in early May, recovering from three-week lows, as investors analyzed the European Central Bank’s latest policy decision and a fresh rise in oil prices amid Middle East tensions. The ECB held rates steady but kept options open for June and beyond, noting heightened inflation risks and growth concerns. At the press conference, ECB President Christine Lagarde confirmed the decision to hold rates was unanimous, though a hike had been discussed. Meanwhile, ECB official Joachim Nagel cautioned that the central bank might need to tighten policy as early as June, citing a worsening inflation outlook and the risk of persistent price growth. Fellow official Madis Müller also signaled that rates could require an increase. Market expectations now include three rate hikes in 2026, with the first fully priced in by July. Adding to the upward push, Brent crude prices climbed further after US President Donald Trump maintained the naval blockade of Iranian ports.
2026-05-01
Euro Rises to $1.17 as ECB Leaves Options Open
The euro edged up to $1.17, recovering from three-week lows and heading for a monthly gain of over 1% against the dollar, after the ECB held interest rates as expected but left all options open for its June meeting and beyond. Policymakers noted that while recent data aligned with their inflation outlook, upside risks to inflation and downside risks to growth have intensified. At the press conference, ECB President Christine Lagarde said the hold was unanimous, though a hike was debated, and policymakers agreed they are "moving away" from the baseline scenario. Money markets anticipate around 75 basis points of hikes by year-end. On the data front, Eurozone inflation rose to 3% in April, the highest since September 2023 and well above the ECB’s 2% target. Meanwhile, the bloc’s economy unexpectedly slowed in Q1, growing just 0.1%, as the Middle East conflict disrupted energy supplies.
2026-04-30
Euro Stays Below $1.17 as ECB Meets
The euro held below $1.17, its weakest since April 8, as investors awaited the European Central Bank’s policy decision and digested fresh economic data, including Eurozone preliminary GDP and inflation figures. Brent crude’s rally to four-year highs, spurred by reports of potential US military action in Iran, heightened inflation concerns ahead of the meeting. The ECB is expected to keep rates unchanged on Thursday, yet markets are pricing in three quarter-point hikes in 2026 due to inflationary pressures from the oil shock tied to the Iran conflict. Data from Europe’s largest economies showed inflation accelerating in April, driven by soaring energy prices. This comes after the Federal Reserve’s decision to hold rates, though its meeting exposed deepening divisions, with four officials dissenting for the first time since October 1992, three of whom opposed the Fed’s signal of eventual rate cuts.
2026-04-30