ECB Vice-President Luis de Guindos signaled a cautious approach ahead of next week’s policy meeting, emphasizing the need to assess whether higher energy costs are feeding into broader inflation. Speaking in Spain, he stressed that policymakers must “keep a cool head” amid what he described as “tremendous uncertainty.”
De Guindos noted that current energy price developments sit between the ECB’s baseline scenario—where inflation rises only temporarily—and a more adverse scenario involving persistent spillovers into other prices. The key question for policymakers is whether rising oil and gas costs begin to affect wages and services, which would justify a stronger policy response.
His comments align with recent signals from President Christine Lagarde and other officials that the ECB is not yet ready to react to energy-driven inflation alone. The central bank appears set to hold rates steady next week, maintaining a wait-and-see stance as it evaluates incoming data.
