According to ECB's Nagel, are high inflation levels in the euro zone currently triggering second-round effects like broad-based wage and price increases?

No. Nagel stated explicitly: 'There are so far no clear signs that inflation has fed through to price and wage setting,' and added that 'longer-term market-based and expert expectations remain consistent with the Eurosystem’s 2% inflation target.'

What key risks did Nagel identify as potentially sustaining or worsening euro zone inflation, beyond energy prices?

Nagel cited low gas storage levels requiring higher winter purchases, destruction of refining capacity driving up refined petroleum product prices, and drought, wildfires, and fertiliser shortages posing risks to food prices.

ECB's Nagel: High Inflation Not Yet Setting Off Second-Round Effects

Oct 5, 2026

Bundesbank President Joachim Nagel stated Eurozone inflation remains high despite energy costs not yet impacting wages. He warned that low gas storage, refining capacity loss, and fertiliser shortages threaten future price stability.

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