ECB's Panetta Warns of Financial Stability Risks Amid Energy Crisis
Fabio Panetta, a member of the European Central Bank's Governing Council, has expressed concerns over the financial stability risks posed by the ongoing energy crisis, exacerbated by the U.S.-Israeli conflict with Iran. Speaking at a conference in Rome, Panetta highlighted how shifts in global investor risk perceptions could lead to increased pressure on government bonds, particularly in countries with high public debt like Italy. The energy crisis has led to a sharp rise in Eurozone inflation, which jumped to 2.5% in March from 1.9% in February, driven by surging energy prices. Panetta noted that even if the conflict were to end swiftly, a return to normal energy production would take time, potentially extending into late 2026 or 2027. 
