The Hawk Speaks: ECB's Schnabel Signals Comfort with Rate Hike Bets, Boosting the Euro

European Central Bank (ECB) Executive Board member Isabel Schnabel, a known hawk, has rattled markets by stating she is "rather comfortable" with investor bets that the central bank's next move will be a rate hike, not a cut. Citing a resilient economy and stalled core inflation, her comments introduce significant upside risk to the EUR/USD currency pair and push back the prevailing market narrative of an inevitable easing cycle.