ECB President Christine Lagarde said Saturday that a selloff in bonds is making euro zone borrowing more expensive, curbing growth and ultimately inflation. Bond yields worldwide have surged in recent weeks, with debt-laden France among the hardest hit, amid worries about debt and inflation and growing competition for credit from AI investments. Lagarde said this will make it harder for consumers to absorb higher fuel prices from the Iran war than the ECB projected last month, slowing growth and reducing pass-through more than expected. The ECB has raised rates twice in the last four months and another hike is expected in December, which would lift its policy rate to 2.75%, a level it considers restrictive. Fellow policymaker Nagel hinted at more tightening and said the job on inflation is not done, while Rehn said there is no sign of second-round effects but the ECB will stay vigilant.
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Related tickers and likely impact
DXY
▲ Likely positiveRelevance: low
| Market | Currencies |
|---|---|
| Close on 10/16/2026 | 101.78 |
| Change that session | -0.20% |
EUR/USD
▼ Likely negativeRelevance: low
| Market | Currencies |
|---|---|
| Close on 10/16/2026 | 1.12393 |
| Change that session | +0.16% |
Impact is scored by AI from the headline and may be wrong. It is not investment advice.
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