ECB's Rehn says tightening is not guaranteed, the policy path depends a lot on how the Middle East conflict evolves

Rehn's comment indicates a more cautious approach by the ECB, suggesting that future tightening isn’t assured and is closely linked to external geopolitical developments, particularly in the Middle East. This implies heightened uncertainty around the ECB's policy path, which could influence market expectations for interest rates and the direction of the euro and German bond yields depending on how events unfold. Traders should monitor both the geopolitical landscape and the central bank's communications for further insights.