European Central Bank President Christine Lagarde said they will continue to raise interest rates.
European Central Bank President Christine Lagarde said it is unlikely that the ECB will peak interest rates in the near future and continue to raise interest rates.
Christine Lagarde, President of the European Central Bank (ECB), said the ECB will continue to raise interest rates in a statement today in Sintra, Portugal.
Lagarde said that the ECB is unlikely to peak interest rates in the near future and should not hesitate to fight inflation. “Unless there is a significant change in forecasts, we will continue to raise rates in July,” Lagarde said.
“It is unlikely that the central bank will be able to say very confidently that peak interest rates have been reached in the near future,” Lagarde said, adding that for this reason, policy should be decided in meetings and stick to the data.
INTEREST HIGH IN 22 YEARS
At its last meeting, the ECB raised three key interest rates by 25 basis points, in line with market expectations. The Bank increased the overnight deposit rate to 3.50%, the refinancing rate to 4% and the cap funding rate to 4.25%.
The ECB began raising interest rates in July last year after an 11-year hiatus. Thus, the bank increased the interest rate by 400 basis points in just 8 meetings held in 11 months.
ECB officials said inflation will remain high for a long time and raised their inflation forecast from 5.3% to 5.4% for 2023 and from 2.9% to 3% for 2024.
The bank cut its growth forecast from 1% to 0.9% for 2023 and from 1.7% to 1.5% for 2024.
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