Spain's response to Iran war fallout must be tailored, Escriva says

MADRID, March 20 (Reuters) - Spain ‌should ensure ​any ​measures to cushion the economic impact of the war in Iran are tailored to help the hardest‑hit ‌sectors and households and last only as long as ⁠needed, Bank of Spain Governor Jose Luis Escriva told EFE.

Oil and gas prices ‌have jumped since U.S.-Israeli ‌attacks on Iran began, raising the risk that higher energy costs will drive up consumer prices and depress economic activity ​across the 21-nation currency bloc, which relies heavily on imported fuel.

"In situations of this nature, the measures adopted must ⁠be very clearly defined to protect those areas of the economy and society that ​are most affected", Escriva told state-news agency EFE in an interview published on Friday.

The Spanish government is ​set to approve at an extraordinary ‌cabinet meeting on Friday a plan to help households and business weather the impact from higher energy ⁠prices.

The ECB kept its key interest rate at 2% on Thursday, but policymakers expect to discuss hikes in the coming months as ⁠the Iran war pushes up inflation in the euro zone.

Escriva said it was "very ​difficult to discern exactly what the impact of this rise in energy prices will be" and insisted that "the ECB makes decisions based on the ‌medium-term evolution of inflation and sometimes there are situations that subside and do not necessarily entail ‌a change in interest rates."

He also said that the situation ⁠was "highly uncertain and volatile and ‌what we must ​do is continue to assess a wealth of information."

(Reporting by Jesús Aguado; Editing by Emma Pinedo and ‌Thomas Derpinghaus)

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