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The European Central Bank (ECB)’s Makhlouf warned that a potential peace deal with Iran might not rapidly alleviate inflationary pressures, despite expectations of lower oil prices. He emphasized that global supply chain disruptions and persistent energy costs could prolong inflation. The ECB remains cautious about premature policy easing, with markets closely watching for any hints of rate adjustments. For traders, this uncertainty could lead to volatility in EUR/USD and commodity markets, as investors reassess inflation risks. The warning underscores the complexity of geopolitical events on macroeconomic stability, requiring traders to monitor both oil price movements and central bank communications. Key assets to watch include EUR/USD and oil prices, with potential spillovers to broader European equities and bond yields.
