ECB chief economist Lane said that if incoming data remain unchanged over the
coming weeks, the ECB should raise borrowing costs at its December meeting.
Despite potential oil volatility, he warned year‑end inflation could be slightly
above 4%, with food and core prices likely to accelerate, particularly in Q1
next year. If the December information set mirrors today’s, a rate rise would be
prudent, he said, and there will be further developments on peak inflation.
Markets price a high probability of a December hike and expect additional
tightening into 2027. Lane said the ECB will "follow the data" next year and
urged traders not to rely solely on commodity moves, calling for market
repricing to reflect broader macro developments as well as energy.
