ECB's Vujcic says inflation rise since Iran war was expected

Investing.com -- European Central Bank Governing Council member Boris Vujcic said Tuesday that the increase in inflation expectations following the outbreak of the Iran war was anticipated by the central bank.

"This is what we have expected, what we have said — that inflation is certainly going to rise in connection to events in Iran," the Croatian official told reporters in Zagreb.

Vujcic noted that prolonged conflict and greater damage to energy infrastructure would likely increase pressure on energy prices, which would translate into higher inflation.

ECB officials are examining price outlooks from consumers, firms and investors as they decide how to respond to rising energy costs. These costs triggered the sharpest increase in euro-area inflation since 2022 in March.

Some policymakers believe an interest rate hike may be necessary next month, but Vujcic declined to comment on the likelihood of such a move.

"Nothing is certain, there will be a lot of data and news by the time of our meeting in April," he said.

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