Isabel Schnabel, a member of the European Central Bank's (ECB) Executive Board, stated on the 1st (local time) that the inflationary impact caused by the Iran war can no longer be ignored, as price pressures are spreading beyond the energy sector and the risk of inflation expectations de-anchoring is increasing. She explained that the destruction of energy infrastructure and global supply chains has changed price dynamics in a more persistent way, and that policy responses may be necessary even if the conflict ends immediately. Regarding the number of interest rate hikes, she said, "It's too early to say that it will end with just a few hikes," adding, "We need to observe how the situation unfolds going forward." Schnabel pointed out that this shock differs from past energy crises in that it increasingly takes on the character of a global demand shock, simultaneously driving up production costs worldwide.
