Home » ECB, Lagarde goes straight and raises interest rates by 50 points

ECB, Lagarde goes straight and raises interest rates by 50 points

by admin
ECB, Lagarde goes straight and raises interest rates by 50 points

The ECB raises rates and does not provide indications on any future increases

The president of the European Central Bank Christine Lagarde go straight. Despite the requests of the markets, in the light of the problems of the last few days in the banking sector, the Governing Council of the ECB has decided (as anticipated in the January meeting) to raise by 50 basis points the three reference interest rates.

A move dictated by the consideration that “inflation should remain too high for too long a period of time”.

But the ECB this time it does not provide indications on any future increases reiterating how “the high level of uncertainty increases the importance of an evidence-based approach to the Governing Council’s decisions on key rates, which will be determined by its assessments of the inflation outlook in the light of new economic and financial data, the dynamics of underlying inflation and the intensity of monetary policy transmission”.

ECB: 2023 estimates revised for the Eurozone, GDP +1% and inflation at 5.3%

The new ones were presented at the meeting of the Board of Directors macroeconomic projections by ECB experts who see a figure revised downwards for inflation mainly due to the lower contribution of energy prices: now the Eurotower estimates inflation on average at 5.3% in 2023al 2.9% in 2024 and al 2.1% in 2025. Even if, it is specified, the underlying pressures on prices remain intense.

The projections for growth in 2023 have also been corrected upwards in the baseline scenario, settling on average at 1.0% due to both the fall in energy prices and the greater resilience of the economy to the difficult international context. ECB experts also expect growth to rise further to 1.6% in both 2024 and 2025supported by the strength of the labor market, the improvement of the climate of confidence and the recovery of real incomes”.

See also  Passenger lands plane after pilot has medical emergency

For the 2024 and 2025 figures, this is a growth “lower than the December projections, reflecting the more restrictive monetary policy”.

The projections, however, were “completed in early March, before the recent tensions that emerged in the financial markets”, tensions which “therefore lead to further uncertainty regarding assessments of the baseline scenario for inflation and growth.

Subscribe to the newsletter

You may also like

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More

Privacy & Cookies Policy