Rate hikes continue, but at a more moderate pace. The European Central Bank (ECB) has announced that it will raise the price of money by 25 basis points to 3.75% at its governing council meeting in Frankfurt next Thursday. For example, it halves the increase in interest rates, which have been 50 points so far, and follows the same path as the US Federal Reserve, which raised them by 0.25% and now places them at 2007 levels. in April – excluding food and energy prices – are not enough for the ECB, which insists it will do “whatever it takes” to keep prices below 2% over the medium term. Eurozone prices are still out of control, rising to 7% in April, fueled by the economic fallout from the war in Ukraine. Since July last year, the European entity has raised the price of money to 3.75%, and just two weeks ago its chief economist, Phillip Lane, assured that “current data suggests we should continue down this path.” However, the recent financial turmoil, with the intervention of Silicon Valley Bank (SVB) and the bailout of the Swiss entity Credit Suisse, has given signs of instability and the ECB has decided to moderate the increases to curb consumption and the keep prices in check. Thursday’s decision carries special weight in countries like Spain, with lower inflation (3.8% in April). And it is that, while the Baltic regions record high prices, with Lithuania leading (15%), in those regions where prices have been significantly reduced, the ECB’s measures could jeopardize economic growth. Before knowing the organization’s decision, the First Vice President and Spanish Minister of Economy, Nadia Calviño, emphasized that she hopes that “she will succeed in formulating a monetary policy that limits inflation without compromising economic growth and creation jeopardizing employment”.
Source: La Verdad
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
