The European Parliament's Economic and Monetary Affairs Committee on 23 June 2026 held an exchange of views on the economic and fiscal implications of the Middle East crisis, with ECB and Commission officials presenting diverging assessments on inflation drivers and policy responses. ECB Executive Board member Philip R. Lane noted the euro area economy grew 0.8% in 2026, with inflation at 3.2% driven by energy, but stressed the labour market remains resilient and defended the ECB's data-dependent rate hikes as appropriate given inflation persistence. European Commission Director General Maarten Verwey presented the spring forecast revising EU growth down to 1.1% and inflation up to 3%, cautioning against untargeted fiscal measures like those in 2022 (2.1% of GDP) and highlighting limited fiscal space due to higher debt and defence spending. OECD Director Åsa Johansson outlined two scenarios: a time-limited disruption with gradual recovery, and a prolonged disruption severely cutting growth; she noted most member states' support measures remain broad-based and untargeted, urging temporary, targeted support and reduced fossil fuel dependence.
EPP MEP Luděk Niedermayer questioned why the energy price impact was milder than feared; Verwey cited well-supplied markets, strategic reserve releases, and adaptability.
S&D MEP Thomas Bajada raised concerns about disproportionate impacts on islands like Malta, asking the Commission about greater flexibility on state aid and consumer support, and questioned the ECB's reliance on rate hikes for supply-driven inflation. Lane defended the approach as appropriate given the inflation persistence. Next steps: the committee will continue monitoring the situation, with the Commission proposing to expand the national escape clause for defence and energy security spending.