Full report hereECB's Stournaras said renewed hostilities in the Middle East have reignited uncertainty over the inflation and growth outlook after the swift easing in energy prices following the US-Iran Memorandum of Understanding. He noted that renewed disruptions to energy flows and higher oil prices are weighing on economic activity and reviving inflationary pressures, particularly as the Eurozone remains a net energy importer. Although Eurozone inflation slowed to 2.8% in June from 3.2% in May, offering hope for a more favourable outlook, the renewed escalation has increased uncertainty again. Stournaras said higher energy costs and weaker confidence are expected to weigh on Eurozone growth in 2026, while ECB staff projections see GDP expanding 0.8% in 2026, 1.2% in 2027 and 1.5% in 2029. He didn't offer any guidance on the near-term monetary policy path, but we already know that the probabilities for a rate hike in July dropped substantially following the last inflation data. Traders are pricing in a 92% chance of a rate hike in September followed by another one in December. It goes without saying that a concrete de-escalation in the Middle East would lower oil prices and rate hike expectations. This article was written by Giuseppe Dellamotta at investinglive.com.