Institution: The European Central Bank's interest rate hike may plunge the eurozone into an "unnecessary" recession.

Holger Schmieding of Berenberg said in a report that the European Central Bank is expected to raise interest rates once or multiple times this year, which would be a mistake. Schmieding stated, "The last thing the eurozone needs is further headwinds in the form of higher interest rates, which would exacerbate the fallout from the Iran war. Consumer confidence is already at crisis levels, while private sector activity is shrinking. At the same time, oil prices have come down and wage demands seem limited." Therefore, it seems unlikely that temporary price spikes will evolve into persistent inflation issues. However, the European Central Bank may still revise its inflation forecasts, leading to more rate hikes in the future and further dragging down the eurozone's economy. "The region may even risk unnecessary recession," he said.