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The European Central Bank (ECB) raised interest rates on June 11 for the first time since September 2023, moving to contain an energy-driven inflation shock triggered by the war in the Middle East even as the eurozone economy shows signs of weakening.
The ECB lifted its three key rates by 25 basis points, taking the benchmark deposit rate to 2.25 percent from 2 percent, according to a June 11 policy statement citing inflation pressures driven by an energy price shock stemming from the Iran war.
“The decision to raise rates is robust across a range of scenarios mapping out how the shock might evolve and affect the medium-term outlook,” the ECB’s governing council said in the statement, which described the outlook as “uncertain, with upside risks for inflation and downside risks for economic growth.”…
The ECB lifted its three key rates by 25 basis points, taking the benchmark deposit rate to 2.25 percent from 2 percent, according to a June 11 policy statement citing inflation pressures driven by an energy price shock stemming from the Iran war.
“The decision to raise rates is robust across a range of scenarios mapping out how the shock might evolve and affect the medium-term outlook,” the ECB’s governing council said in the statement, which described the outlook as “uncertain, with upside risks for inflation and downside risks for economic growth.”…
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