Rate hike – what is key for the ECB
The ECB is expected to keep interest rates unchanged next week.
Commerzbank Economic Research
04/24/2026
"Hold" in April ...
The members of the ECB Governing Council are unlikely to raise interest rates at next week’s monetary policy meeting. According to their latest statements, the central bankers remain “vigilant.” However, they do not want to act hastily; rather, monetary policy must be conducted with a steady hand. Furthermore, the rise in bond yields is already having the effect of a certain degree of monetary tightening. Individual Governing Council members, such as Greek central bank governor Stournaras and his Lithuanian counterpart Šimkus, have recently spoken out clearly against an interest rate hike. After all, since the talks between the U.S. and Iran, there is a real chance of an early end to the war. Already, crude oil and gas prices have shown a slight downward trend, which is also becoming noticeable at the gas pumps. This has made the ECB’s baseline scenario more likely, in which ECB economists project only a temporary rise in inflation and no lasting effects on core inflation.
... and "secure" in June
However, we still consider an interest rate hike in June to be likely, especially if the stalemate around the Strait of Hormuz continues, which yet remains completely blocked. After all, memories of the 2022 surge in inflation are still fresh. Some of the indicators cited by ECB President Lagarde at the last press conference also point to increased inflation risks.
Companies are already passing on higher prices
The subcomponents of the Purchasing Managers’ Index (PMI) for the eurozone point to upside risks for inflation. According to these figures, companies in both the manufacturing and services sectors are now reporting higher input prices. The manufacturing PMI, in particular, bears a striking resemblance to its rise a few years ago. At the same time, more companies, especially in the manufacturing sector, report having raised their selling prices as well. In addition, the quarterly telephone survey of companies mentioned by ECB President Lagarde was conducted in early April. Plans for price increases will play a decisive role in this. Lagarde is expected to comment on the results at next week’s press conference.
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