Finance
ECB's Rehn: Slowing Green Transition Due to War Would Be 'serious Mistake'
Published by Global Banking & Finance Review®
Posted on April 14, 2026
2 min readLast updated: April 14, 2026
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ECB policymaker Olli Rehn warned on April 14 in Helsinki that delaying Europe’s green energy transition amid the Middle East war would be “a serious mistake,” highlighting how the conflict amplifies the urgency for resilience amid inflation and energy supply risks.
ECB rate hike not self-evident, policymaker Rehn says
ECB Policy Outlook Amid Middle East Conflict
Uncertainty Over Upcoming Rate Hike
HELSINKI, April 14 (Reuters) - A rate hike is not self-evident at the European Central Bank's next policy meeting on April 30, ECB policymaker Olli Rehn said on Tuesday, adding that the ECB was closely monitoring the Middle East conflict and its spillover effects on the economy.
Inflation Trends and Economic Impact
A rise in headline inflation this year will be unavoidable, the Bank of Finland governor said.
But over the medium term, it remained unclear what effect the war would have on inflation, he said.
Rehn's Comments on Rate Decision
"A rate hike is not self-evident, but we have to proceed by keeping calm and closely analysing the effects of the war in Iran and the closure of Strait of Hormuz on the economy," he told reporters, when asked about the next rate meeting.
Varying Impact Across Euro Area Countries
The strength of the war's impact on each of the euro area countries varied, Rehn added.
"The impact on the Finnish economy is moderated by the fact that Finland has made more rapid progress in the energy transition than many other countries," he said.
Importance of Green Transition for Europe
The Middle East war highlights how vital the green transition in energy is for Europe's resilience and competitiveness, Rehn said. "Slowing the green transition now would be a serious mistake."
(Reporting by Anne Kauranen in Helsinki; Editing by Andrew Heavens and Janane Venkatraman)
Key Takeaways
- •Rehn stressed that slowing the green transition now would undermine Europe’s resilience and competitiveness amid volatile energy markets and inflation risks triggered by the Middle East war.
- •He noted uncertainty over the war’s medium‑term inflation effects and emphasized that ECB interest‑rate policy remains flexible, responding to new data rather than pre‑committing.
- •Rehn observed that Finland, having progressed faster in its energy transition, is less exposed to shocks from the war—underlining how renewables and diversification can buffer economies against geopolitical shocks.
Frequently Asked Questions about ECB's Rehn: Slowing green transition due to war would be 'serious mistake'
1Why does Olli Rehn believe slowing the green transition is a serious mistake?
Olli Rehn states that slowing the green transition would weaken Europe's resilience and competitiveness, especially amid Middle East conflicts.
2How does the Middle East conflict affect Europe's green transition?
The war highlights the importance of energy resilience and accelerates the need for a green transition in Europe.
3What is the expected impact of the war on European inflation?
A rise in headline inflation this year is seen as unavoidable, though the medium-term effects remain unclear.
4Are ECB interest rate decisions predetermined amid global conflicts?
No, ECB interest rate decisions are not locked in beforehand and depend on evolving economic conditions.
5How does Finland's energy transition progress compare to other euro area countries?
Finland has made more rapid progress in the energy transition than many other countries, moderating the war's impact on its economy.