ECB Executive Board member Isabel Schnabel said interest rates will likely need to rise further as a combination of a resilient European economy and renewed Middle East tensions continue to put upward pressure on inflation.
Schnabel’s comments underscore the central bank’s cautious stance amid stronger-than-expected activity in parts of the euro area and persistent upside risks to prices.
Oil fell for a third straight day, with Brent crude sliding below USD 86 a barrel after reports that Iran and Oman have discussed a potential deal to reopen the Strait of Hormuz — a development that would ease shipping-risk premia that had buoyed prices in recent sessions.
In trade news, the Trump administration is considering additional penalties on Canada after Prime Minister Mike Carney announced dollar-for-dollar retaliation to U.S. tariffs introduced last Saturday. The escalating tit-for-tat raises the prospect of a prolonged trade standoff between two longtime allies, complicating supply chains and policy coordination.
Elsewhere, Bloomberg reported that anchor investors in Shein’s planned listing have agreed to a six-month lockup on shares sold in the IPO.
Markets remain focused on corporate catalysts: Nvidia’s second-quarter 2026 earnings report — due later today — is expected to be the main driver of risk sentiment as investors hunt for fresh signals on AI-chip demand and data-center spending.
Equities were modestly positive in Europe, where shares advanced about 0.3%. Asian markets were firmer across the board, with Japan, mainland China and Hong Kong gaining between 0.5% and 1%. U.S. futures pointed to a flat open as traders balanced central-bank talk, geopolitical developments and corporate results.
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