The ECB raises interest rates by half a percentage point to 2.5%, the highest level since 2008

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The European Central Bank estimates that interest rates “will have to be raised further” to halt the price escalation.

Euskaraz irakurri: EBZk ehuneko puntu erdi igo ditu interest-tasak, %2.5eraino, 2008tik izan duen mailarik altuenera

The European Central Bank raised interest rates again this Thursday by another 50 basis points, bringing them to 2.5%, the highest level since December 2008.

With this fourth consecutive increase the price of money, the ECB moderated the intensity of the normalization of its monetary policy, following two 75 basis point increases at the October and September meetings, following an initial increase of half a percentage point in July.

In particular, the Governing Council estimates that interest rates “will have to be increased even further significantly at a steady pace” until they reach enough mitigating levels to ensure a timely return to the medium-term target of 2%.

The ECB’s decision comes days after it was announced that year-on-year inflation in the euro area was 10% in November, six-tenths below the historic high set in October and the first slowdown in 17 months.

The ECB’s less aggressiveness is in line with other major central banks, such as the US Federal Reserve and the Bank of England, which announced less intense interest rate hikes at their respective monetary policy meetings in December.

Such is the case of the Federal Reserve Open Market Committee (FOMC) which yesterday chose to take its foot off the accelerator and agreed to a 50 basis point rate hike, its seventh since March, to put it in the range between 4.25 % to place. and 4.5%, the highest level in 15 years in the US since December 2007.

In turn, the Bank of England’s Monetary Policy Committee has decided to raise the benchmark interest rate for its operations by 50 basis points to 3.50%, the highest level since autumn 2008. .

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Source: EITB

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