The European Central Bank raises interest rates to step up the fight against inflation and indicates that more is on the way
The European Central Bank (ECB) raised interest rates again yesterday, announcing further rate hikes as the battle against inflation intensifies.
Less than 24 hours after the US Federal Reserve raised interest rates by 0.25 percentage point to 5.25 percent despite the crisis in the banking sector, the ECB raised them by the same amount to 3.25 percent in the eurozone.
The European Central Bank (ECB) raised interest rates again yesterday, announcing further rate hikes as the battle against inflation intensifies.
Less than 24 hours after the US Federal Reserve raised interest rates by 0.25 percentage point to 5.25 percent despite the crisis in the banking sector, the ECB raised them by the same amount to 3.25 percent in the eurozone.
It is the latest in a series that has raised interest rates from -0.5 percent since July, but less than the recent increases of 0.75 and 0.5 percentage points.
Ongoing battle: ECB President Christine Lagarde (pictured) stressed that the latest, relatively smaller, 0.25-point increase did not mean yesterday’s move would be the last.
ECB President Christine Lagarde insisted the delay did not mean yesterday’s move would be the last. “We’re not standing still, that’s very clear,” she said. “We know we have more ground to cover.”
Fed Chairman Jerome Powell suggested the US central bank was ready to pause after aggressive rate hikes.
The Bank of England looks set to raise interest rates from 4.25% to 4.5% next week as it grapples with double-digit inflation.
Yesterday’s figures suggest that the economy is picking up, with the dominant services sector experiencing its fastest growth rate in a year in April and mortgage lending picking up again in March.
Paul Dales, chief UK economist at Capital Economics, said there is a ‘decent chance’ UK rates will peak at 4.5 per cent, but warned they could reach 5 per cent if inflation remains higher than expected.
It is the latest in a series that has raised interest rates from -0.5 percent since July, but less than the recent increases of 0.75 and 0.5 percentage points.
ECB President Christine Lagarde insisted the delay did not mean yesterday’s move would be the last. “We’re not standing still, that’s very clear,” she said. “We know we have more ground to cover.”
Fed Chairman Jerome Powell suggested the US central bank was ready to pause after aggressive rate hikes.
The Bank of England looks set to raise interest rates from 4.25% to 4.5% next week as it grapples with double-digit inflation.
Yesterday’s figures suggest that the economy is picking up, with the dominant services sector experiencing its fastest growth rate in a year in April and mortgage lending picking up again in March.
Paul Dales, chief UK economist at Capital Economics, said there is a ‘decent chance’ UK rates will peak at 4.5 per cent, but warned they could reach 5 per cent if inflation remains higher than expected.