European Central Bank Raises Rates by 50 Basis Points
ECB President Christine Lagarde: "Inflation Remains Far Too High"
Frankfurt am Main, Germany - Reuters
The European Central Bank (ECB) has announced a 50 basis point increase in its three key policy rates, marking the highest rate hike since the euro was introduced in 1999.
In a press conference following the decision, ECB President Christine Lagarde emphasized that inflation remains "far too high" in the eurozone, currently standing at 8.5%.
"Today's decision underscores our commitment to bringing inflation back to our 2% target," Lagarde said. "We expect inflation to remain high for some time, but we are determined to act decisively to bring it down."
The ECB's decision comes amidst growing concerns about the impact of the Russia-Ukraine war on the eurozone economy. Lagarde acknowledged these challenges but stressed that the ECB's focus remains on controlling inflation.
When asked if the ECB is now in a "dialing-back mode" after a series of aggressive rate hikes, Lagarde declined to commit, stating that the ECB will continue to assess the economic situation and adjust its policy accordingly.
The ECB's rate hike is expected to have a significant impact on the eurozone economy, potentially slowing growth and increasing borrowing costs for businesses and households.
Comments