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ECB official says stagflation risk from Hormuz crisis is remote

Piero Cipollone said monetary policy should be well calibrated and that inflation is far from adverse scenarios, with no signs of stagflation.

Reported · Written up by our desk · Central Banks

European Central Bank Executive Board member Piero Cipollone said the risk that the Strait of Hormuz crisis could trigger both economic stagnation and a sharp inflation jump is rather remote, according to remarks reported by Reuters via FXStreet.

Cipollone said monetary policy needs to be well calibrated, and that inflation is not close to adverse and severe scenarios. He added that there are no signs pointing to a stagflation scenario.

The ECB sets monetary policy with the goal of maintaining price stability, using interest rate adjustments as its primary tool, while eurozone inflation data and related economic indicators can influence policy direction.

FXStreet also noted that the euro is the second most heavily traded currency globally, and that the EUR/USD pair is the most traded currency pair, accounting for an estimated 30% of all transactions.

Latest closeEUR/USD 1.157 ▲0.4%

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