Dimitar Radev, Governor of the Bulgarian National Bank and a member of the ECB Governing Council, is sounding the alarm. The message is simple: move fast on inflation or pay more later.
Radev stated on April 7 that the European Central Bank must be prepared to raise interest rates swiftly if the energy price surge from the ongoing Iran conflict translates into persistent inflation. Euro area inflation has already blown past the ECB’s 2% target, and the 2026 inflation forecast has been revised upward to 2.6%.
The case for urgency
Radev flagged exactly this risk. As early as March 23, he pointed to emerging signs that second-round inflation effects were already taking shape in connection with the Middle East conflict. By April, his tone had sharpened.
He warned that inflation expectations could rise more quickly than usual because of the geopolitical shock layer sitting on top of an already complicated economic picture. The balance of risks, in his view, has shifted meaningfully.
