The European Central Bank (ECB) again raised the interest rates officials this Thursday in 0.25 points percentage. This is his eighth consecutive hike since he began to tighten monetary policy to deal with inflation.
Thus, the Governing Council of the monetary authority has carried out the 4% main rate (the highest level since July 2008, the dawn of the great financial crisis), while the deposit facility (the interest with which the Central Bank remunerates the money it keeps to the banks, the most relevant in the current context) reaches 3.5%.
“Inflation has come down, but it is expected to remain too high for too long,” he said.
In addition, he added that “future decisions by the Governing Council will ensure that key ECB interest rates are taken to sufficiently restrictive levels to achieve a timely return of inflation to the 2% medium-term target.”
Upward revision of inflation projections
Inflation in the Eurozone is running at 6.1% and, while well below double-digit readings last fall and a recession, coupled with sharply lower commodity prices, will quickly cool price growth over the rest of the year, notes Reuters.
The agency also notes that the labor market remains tight, nominal wage growth is rapid and underlying price pressures, particularly for services, appear stubbornly high.
In this regard, the ECB noted that “the staff have revised upwards their inflation projections excluding energy and food, especially for this year and next, due to past upward surprises and the implications of the strong labor market for the speed of disinflation. “.
Source: Larepublica
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