European Central Bank would continue raising interest rates in July

He European Central Bank (ECB) will continue with its plan to raise interest rates in July, as announced by Christine Lagarde, president of the ECB, during a forum in Sintra, Portugal.

In this sense, Lagarde affirmed that it is still too early to “cry victory” in the fight against inflation in the euro zone, and that the work of the ECB has not finished.

He also reiterated that unless there are significant changes in the outlook, interest rates will continue to increase next month. He warned that in the near future, the central bank will not be able to say with certainty that interest rates have peaked.

In its most recent monetary policy meeting in June, the institution made the decision to carry out the eighth increase in less than a year in its interest rates, raising the reference rate for deposits by a quarter of a percentage point until reaching 3.5%. This measure reflects the bank’s firm commitment to address inflationary challenges and seek economic stability in the region.

The ECB started this unprecedented cycle of monetary tightening a year ago, with the aim of countering the rise in prices. However, now some voices have called for a pause in this process to avoid putting more pressure on economic activity. On that occasion, Lagarde called the prospect of a rate hike in July “very likely.”

However, he warned on Tuesday against a “too rapid turn in monetary policy” due to a “more persistent inflation process” in the euro area. He also highlighted the “uncertainty” in relation to the effect of the ECB’s monetary policies, both in their duration and in their level.