ECB's Makhlouf says he's not ruling anything in or out; a prolonged war would bring the ECB's adverse scenario closer

Makhlouf's comments suggest a cautious approach from the ECB as they navigate potential economic impacts from a prolonged conflict. By not ruling out scenarios, they signal that they are prepared to adjust policy based on evolving risks, particularly regarding inflation and growth, which could lead to increased market volatility in both the EUR and fixed income space.