The latest Market Talks covering Energy markets. Published exclusively on Dow Jones Newswires throughout the day.
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)
0921 ET - State-owned QatarEnergy says Iranian missile strikes caused "extensive further damage" on the Ras Laffan complex in Qatar, home to the world's largest liquefied-natural-gas export facility. The attack followed another Iranian strike at the site on Wednesday that also inflicted significant damage. The attacks are pushing up crude oil futures, with Brent crude up 5.4% to $113.34 a barrel. "Oil markets, already at $110 per barrel, would likely breach $120 in the immediate aftermath, with further upside depending on the severity of the damage sustained," says Rystad Energy in a note. WTI crude is up 1.3% to $96.74 a barrel. (kirk.maltais@wsj.com)
0917 ET - The Bank of England's minutes suggests the Monetary Policy Committee is "very alive" to the risks stemming from the Middle East crisis, Franklin Templeton Institute's Michael Browne says in a note. "While that may no be enough for the market today, investors should be re-assured that they will act, even though a rate rise would be bad news for the economy," the global investment strategist says. Bond markets are nervous and need reassurance that monetary authorities are on top of their brief and prepared to raise interest rates sooner rather than later, he says. (emese.bartha@wsj.com)
0913 ET - Money markets raise their expectations of the Bank of England increasing interest rates in the coming months after the central bank unanimously kept rates unchanged given the surge in energy prices. The U.K. is particularly vulnerable to the surge in global oil prices "given the liberalisation of U.K. energy markets, the push away from domestic oil production and a limited storage capacity", Ebury's Matthew Ryan says in a note. Markets fully price in the possibility of two 25 basis-point rate rises in 2026, up from a 50% chance of one rate increase priced in on Wednesday, LSEG data show. (miriam.mukuru@wsj.com)
0902 ET - The evolution of the Middle East war is likely to have a big influence on the Bank of England's interest-rate decisions in the coming months, Moneyfarm's Richard Flax says in a note. The BOE on Thursday voted to keep rates on hold at 3.75% in a unanimous decision. Rising tensions in the Middle East are driving up energy costs, raising the risk of high global inflation. "If the current pressures persist, expectations for rate cuts will continue to be pushed back," Flax says. Markets price in a 55% chance of a BOE rate rise in April, LSEG data show. (miriam.mukuru@wsj.com)
0854 ET - Switzerland's central bank might consider allowing the Swiss franc to appreciate further in the near-term, as this would help to cool price pressures amid rising energy prices, Pantheon Macroeconomics economist Ankita Amajuri says. The Swiss National Bank held its key rate at 0% for a third consecutive quarterly meeting on Thursday, and reiterated its message earlier this month that it's willing to intervene in foreign-exchange markets to limit a rapid appreciation of the franc. "As such, we expect the Bank to leave rates unchanged throughout 2026," Amajuri says in a note. The next SNB move is most likely a rate hike in early 2027, when inflation comes closer to the middle of its 0%-2% target band, she says. (edward.frankl@wsj.com)
(END) Dow Jones Newswires
March 19, 2026 10:22 ET (14:22 GMT)
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