ECB Vice President Vujcic: Energy prices will remain high for a long time

ECB Vice President Boris Vujcic said the ongoing Middle East war means energy prices will remain elevated for a longer period and could feed further into broader inflation. Speaking in Cleveland on Friday, he said the key risk is that "energy prices stay higher for longer." Markets share the same view, he added, "and that's why we have this repricing in the yield curve." Vujcic was speaking at a conference co-hosted by the ECB and the Cleveland Fed. He specifically mentioned concerns about a shortage of refining capacity. "It's now pretty clear that for the foreseeable future, we will not see refining capacity returning to the pre-conflict level," he said. "That's why energy prices, especially diesel prices, might stay elevated for a long period and feed further into inflation, because diesel is actually used widely in many products." The remarks came as eurozone September inflation data is due to be released. Economists expect the rate to jump to 3.7%, which would be the highest in three years, providing grounds for further rate hikes.