ECB’s Nagel Says Rates May Need to Enter Mildly Restrictive Territory

Nagel is shifting the ECB debate from how high rates go to how long they stay above neutral, and conditioning that on energy prices rather than growth or wages. That matters for rate-sensitive sectors — real estate, crypto and other long-duration risk assets — because a persistently elevated energy floor keeps the tightening bias alive even as headline inflation cools. The open question is whether other Governing Council members echo the mildly restrictive framing or push back, since that split will shape how the ECB's next meetings are read.