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Flags in front of the ECB headquarters in Frankfurt am Main
Photo: Boris Roessler / dpa
The European Central Bank (ECB) is continuing its interest rate hike course in the fight against high inflation. At its interest rate meeting in Frankfurt on Thursday, it raised key rates by 0.25 percentage points, as it did in May. The deposit rate that banks receive for parking surplus funds, which is the benchmark on the financial markets, will thus rise from 3.25 to 3.50 percent.
ECB President Christine Lagarde recently reaffirmed the central bank's determination to continue the fight against inflation in the European Parliament's Economic and Monetary Affairs Committee. The ECB's decisions would ensure that interest rates reached a sufficiently high level for inflation to return to the target of two percent in time.
Inflation in the euro area eased sharply in May. At 6.1 percent, however, it is still far above the central bank's target. In addition, underlying price pressures, which exclude food and energy, are only just beginning to ease slightly.
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dab/Reuters