Euro edges higher ahead of ECB policy meeting
The euro rose to $1.164, its strongest since late August, as investors positioned for the ECB meeting. Markets price two ECB rate hikes in 2026, while Brent briefly topped $100 and European gas hit three-and-a-half-year highs.
164, its highest since late August, as investors positioned for Thursday’s European Central Bank policy meeting. Policymakers are widely expected to raise rates while keeping a data-dependent stance, with the war involving Iran adding uncertainty to the inflation outlook. Brent crude briefly touched $100 a barrel for the first time since July 24, and European natural gas prices hit fresh three-and-a-half-year highs as Middle East tensions raised concerns over energy supplies. Markets are pricing in two ECB rate hikes in 2026, with the deposit rate seen at 3% by late 2027.
A Reuters poll published on September 3 showed economists expected the ECB to raise rates on Thursday for a second time, before ending what would be its shortest rate-hiking cycle in 15 years.