The latest Market Talks covering Energy markets. Published exclusively on Dow Jones Newswires throughout the day.
1136 ET - ECB President Christine Lagarde says the ECB's baseline assumes that market expectations for interest rates are correct. This is effectively talking the bank into two rate hikes this year, given that the new projections show inflation above 2% through the forecast horizon, Pantheon Macroeconomics' Claus Vistesen says in a note. It's surprising that Lagarde would underwrite market expectations so explicitly, he says. "Overall, this was a strange mic drop at the end of a press conference in which Ms. Lagarde had otherwise emphasized the balanced risks facing the ECB, with upside risks to inflation and downside risks to growth." (edward.frankl@wsj.com)
1123 ET - The Bank of England appears more inclined to interest-rate rises than rate cuts following Thursday's rate decision, Capital Economics' Paul Dales says in a note. The U.K. central bank voted unanimously to keep interest rates on hold at 3.75% and expressed unease about the surge in energy prices. "The BOE suggested it is more concerned about the upsides to inflation from the leap in energy prices triggered by the conflict in the Middle East than the downsides to activity," Dales says. Money markets price in a 36% chance of a 25 basis-point BOE rate rise in April and fully price in a rate increase in June, LSEG data show. (miriam.mukuru@wsj.com)
1109 ET - CBOT corn futures are up 0.8%, leading the row crop complex higher as natural gas futures surge. Fertilizer is the key concern among traders, with corn the most exposed to higher fertilizer costs because it's a nutrient-intensive crop. Analytics provider DTN says urea and anhydrous ammonia prices jumped by 12% and 7%, respectively, from this time last month, as energy-producing infrastructure in the Middle East comes under attack. Natural gas is essential for producing nitrogen-based fertilizers. Soybeans are getting less support, because they generally use less fertilizer than corn, says Doug Bergman of RCM Alternatives in a note. (kirk.maltais@wsj.com)
1041 ET - The Eurpopean Central Bank is likely to hike rates at least once by the end of this year, while the pace and timing of these hikes will hinge on the duration of the conflict in the Middle East, Aberdeen Investments' Felix Feather says in a note. The ECB's emphasis on upside risks to the inflation outlook and a 0.7 percentage-point upward revision to 2026 base-case inflation forecasts "hint at the bank's concern over renewed inflationary pressure, and its willingness to respond with hikes," the economist says. The focus at Thursday's ECB decision, where it kept rates on hold as expected, was always going to be more about its signal for how it might react in future, he says. (emese.bartha@wsj.com)
1040 ET - There seems to be a hands-off mentality among traders in CME live cattle futures, with that most-active contract down 0.7%. "Open interest has been going down," says ADM Investor Services in a note. "There is too much uncertainty of outside markets from the war in Iran, higher energy prices, the strike at JBS and Friday's Cattle on Feed report." Analysts surveyed by WSJ forecast total fed cattle inventories down 0.8 percentage points versus this time last year. New placements are expected to slide 1 point, and marketings are seen dropping nearly 8 points. Lean hogs are also down 0.7%. (kirk.maltais@wsj.com)
1022 ET - The ECB faced criticism in 2022 for acting too slowly amid of rising inflation, a mistake it won't be in a hurry to repeat, says Joe Nellis at MHA. The central bank voted to hold interest rates Thursday. But with energy prices soaring, a hike could yet be in store. "A return to monetary tightening would be unwelcome for an already fragile eurozone economy." The IMF already lowered it outlook for the bloc, which would likely fall even lower if rates are raised, Nellis says. But snowballing energy prices could force the bank's hand. "Aware that they faced criticism in 2021-22 for not acting quickly enough to calm what they saw as 'transitory' inflationary pressures, policymakers at the ECB will not risk acting too slowly this time," Nellis says. (don.forbes@wsj.com)
1003 ET - The ECB's statement alongside its decision to hold rates suggests that policymakers think that the inflationary effects of higher energy prices will outweigh the disinflationary effects of weaker economic growth, Capital Economics' Jack Allen-Reynolds says. Should energy prices keep rising, the balance of opinion could shift towards getting on the front foot by hiking in of April, and perhaps by as much as 50 basis points, he says in a note. If oil and natural-gas prices remain close to their current levels, headline inflation could rise above 3% by April and above 4% in the summer, Allen-Reynolds notes. "We doubt that the ECB would 'look through' a shock that size," he says. (edward.frankl@wsj.com)
1001 ET - The European Central Bank became the seventh central bank to announce unchanged rates in the last 24 hours, acting cautiously in face of the uncertainty stoked by the energy crisis, Premier Miton Investors' Neil Birrell says in a note. "Uncertainty abounds, with spiking energy prices fuelling inflationary fears," the chief investment officer says. "Markets are reacting to these rising risks, and central banks must do so too." Central banks have no choice but to be cautious in approach, the problem being that growth is now a real risk, as recognised by the ECB in their statement, he says. "The outlook is grim at the moment, with no immediate resolution in sight." (emese.bartha@wsj.com)
1000 ET - Unless inflation expectations trend significantly higher from here, the bar for a Bank of England interest-rate hike remains high, Quintet's Daniele Antonucci says in a note. The dataflow in the next few weeks will be crucial, as the situation for energy prices remains fluid and highly uncertain, he says. "Despite weak domestic growth, the dominant concern is that inflation expectations could de-anchor," he says. Wage rises are easing, but not enough to offset the renewed price pressures coming through from the Iran war. "The next policy meeting could take place against a significantly changed backdrop if energy markets continue to be disrupted," Antonucci says. (edward.frankl@wsj.com)
0956 ET - Interest-rate hikes are now a real risk for the U.K. economy, Deutsche Bank's Sanjay Raja says in a note. The message from the Bank of England as it held rates was that it will guard against rising inflation expectations should it lead to more persistent price pressures, he says. Should energy prices stick at current levels, policymakers could be forced into pushing rates higher to curb inflation, which bank staff now see inflation at 3%-3.5% over the coming quarters, Raja says. "The probability of hikes will have risen meaningfully following today's decision with all members noting that they will know more by the April decision," Raja says. (edward.frankl@wsj.com)
0953 ET - Weakness in the U.K. labor market makes the current energy shock different from that seen in 2022, says Jessica Hinds at Fitch Ratings in a note. Persistently-high unemployment is likely to keep a lid on inflation and allow the Bank of England to ease its key rate towards 3%, Hinds says. "On the assumption that the oil price spike is relatively short lived, we would continue to think that the next move will be a cut, not a hike," she says. The central bank kept rates unchanged on Thursday. It indicated that a prolonged shock could prompt more restrictive policy, but that a weaker economy could warrant cuts. "Nevertheless, the risk to our view is that the uncertainty will encourage policymakers to be more cautious in their approach to loosening policy," Hinds says. (don.forbes@wsj.com)
0935 ET - Natural gas futures surge 4.8%, lifted by damage seen to a major gas field in Qatar. Iranian missile attacks hitting the Ras Laffan Industrial City in Qatar "fundamentally alters the global gas market outlook," says Wood Mackenzie in a note. Analysts now see the timeline extending for the facilities to recover. "Market expectations had been for a short disruption, with a controlled restart restoring supply to pre-conflict levels by mid-2026," says analyst Kristy Kramer in a note. "That outlook now appears increasingly unlikely." Iran has threatened additional attacks on other facilities in surrounding countries. (kirk.maltais@wsj.com)
(END) Dow Jones Newswires
March 19, 2026 11:37 ET (15:37 GMT)
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