ECB’s Moulin says banking sector can handle higher interest rates

Moulin's comment is a signal about institutional confidence rather than a policy shift: a Governing Council member publicly vouching for bank resilience suggests the ECB is comfortable that tighter conditions won't destabilize the euro-area banking system. That matters most for lenders and their supervisors, since it implies rate-driven margin gains are being weighed against credit and funding risks without alarm. The open question is whether this assessment holds if borrowing costs keep climbing and asset quality begins to show strain.