The European Central Bank’s deposit facility rate stands at 2.00 percent following the April 2026 decision to hold steady, yet markets assign a 98.2 percent probability of at least one hike during the remainder of the year. An energy-price shock stemming from the Middle East conflict has lifted headline inflation expectations to 2.7 percent for 2026, prompting the Governing Council to signal a data-dependent tightening bias at its most recent meetings. Professional forecasters and futures pricing now embed quarter-point increases as early as June, with additional moves possible later in the year if second-round effects materialize through wages or core measures. This near-certain trader consensus reflects the rapid repricing of monetary policy after the inflation surge. Even at these elevated odds, outcomes could shift if the conflict de-escalates sharply, global demand weakens materially, or incoming data show inflation pressures dissipating faster than projected.