New Delhi, March 19 -- Just when Europe's central bankers thought they had finally overcome stubborn inflation, the war in Iran sparked an oil rally that means the continent's policymakers are once again fretting about price pressures.

In a week when the Reserve Bank of Australia hiked interest rates but the Federal Reserve held them steady, the European Central Bank and its peers are likely to follow the Fed's lead.

Frankfurt has spent much of the past year telling investors it is in a "good place" on monetary policy, but that was before war broke out in the Middle East.

The market is all-but-certain the ECB will hold borrowing costs at 2% for a sixth straight meeting on Thursday, but President Christine Lagarde may well signal that r...