The Governing Council of the ECB, which is responsible for setting monetary policy, decided at its last meeting that interest rates will increase by 25 basis points.
In first rate hike, after 11 years, the European Central Bank is expected to move on Thursday as it tries to deal with record inflation and big increases in borrowing costs across much of the world.
The Governing Council of the ECB, which is responsible for setting monetary policy, decided at its last meeting that interest rates will increase by 25 basis points. However, from June 9 to today conditions have worsened, and central banks around the world have moved one after the other on aggressive interest rate hikes.
In this context, the possibility of Christine Lagarde announcing a wider interest rate increase remains on the table.
EKT is also faced with fears of economic downturn and Political instability in Italy, one of the most over-indebted countries in the eurozone, the Financial Times points out.
The debate among the central bank’s 25-member Governing Council, which began on Wednesday, is expected to reflect growing concern that they are being left behind in the battle against inflation, which rose to a record level of 8.6% in the eurozone in June. The increase would be the central bank’s first in a decade and a 50 basis point hike would end the experiment with negative interest rates.
View the news feed and get the latest news.
