Eurozone: ECB caution and hawkish risk – DBS

DBS Group Research economist Radhika Rao notes that the ECB kept rates unchanged but highlighted spillover risks from geopolitical tensions, with updated projections showing higher Eurozone inflation and weaker growth. DBS Group Research economist Radhika Rao notes that the ECB kept rates unchanged but highlighted spillover risks from geopolitical tensions, with updated projections showing higher Eurozone inflation and… DBS Group Research economist Radhika Rao notes that the ECB kept rates unchanged but highlighted spillover risks from geopolitical tensions, with updated projections showing higher Eurozone inflation and weaker growth. DBS Group Research economist Radhika Rao notes that the ECB kept rates unchanged but highlighted spillover risks from geopolitical tensions, with updated projections showing higher Eurozone inflation and weaker growth. She stresses that policymakers will watch for demand effects from supply shocks, and that rate hikes could re‑enter consideration in 2Q–3Q if energy-driven risks and Euro depreciation persist.ECB steady rates but flags hawkish risks"The ECB left the benchmark rates unchanged… For traders, releases like this can quickly shift rate expectations, currency direction, index futures and broad risk sentiment. Watch the next move in the dollar, front-end yields and index futures to see whether the market prices this release as a true surprise or only a passing headline.