European Central Bank Executive Board member Piero Cipollone said on Monday that the eurozone’s economy has shown surprising resilience despite escalating tensions around the Strait of Hormuz, a critical chokepoint for global oil shipments.
Cipollone, speaking in an interview with Italian news outlet Il Sussidiario, dismissed concerns that the region faces stagflation—a combination of stagnant growth and elevated inflation—stemming from disruptions in the Strait of Hormuz. The waterway, which links the Persian Gulf to the Gulf of Oman, has seen reduced commercial traffic amid heightened tensions between Iran and the United States. While acknowledging the need to monitor evolving macroeconomic conditions, Cipollone stated that current indicators do not point toward a stagflation scenario.
He noted tentative signs that the crisis may soon ease, with oil prices reflecting tentative stabilization. Recent data suggest a slowdown in European economic momentum, yet the bloc’s economy has demonstrated unexpected durability. Cipollone emphasized that inflation remains within the parameters of the ECB’s baseline projections, published in June. According to those forecasts, the eurozone’s headline inflation is expected to average 3.0% in 2026, 2.3% in 2027, and converge with the ECB’s 2.0% target by 2028.
The remarks come as the ECB continues to navigate a delicate balance between supporting growth and managing price stability amid geopolitical risks and shifting energy dynamics.
