The European Central Bank (ECB) on Thursday decided to raise the reference interest rate again by 0.75 basis points to deal with the outbreak of inflation in the eurozone, AFP reports.
According to a press release issued at the end of the ECB Governing Council meeting on Thursday, the increase is aimed at three representative ECB interest rates, for the third time in a row.
As a result of the decisions taken on Thursday, from November 2, 2022, the interest rate on the main refinancing operations and the interest rates on the marginal lending line and the deposit line will increase to 2.00%, 2.25% and 1.50%, respectively. .
The cited source indicates that inflation remains too high and will remain above target for a longer period. In September, inflation in the Eurozone reached 9.9%. In recent months, a surge in energy and food prices, supply bottlenecks and a post-pandemic recovery in demand have led to generalized price pressures and rising inflation.
“The monetary policy of the Board of Governors is aimed at reducing measures to support demand and protect against the risk of persistently high values of inflation expectations,” the press release of the institution from Frankfurt states.
In addition, the Governing Council on Thursday decided to modify the terms of the third series of targeted long-term refinancing operations (OTRTL III).
Currently, given the unexpected and extraordinary acceleration of inflation, it is necessary to recalibrate this instrument to ensure its coherence with the broader process of monetary policy normalization and to strengthen the transmission of monetary policy interest rate increases to bank lending conditions.
Therefore, the Board of Governors decided to adjust the interest rates applicable to OTRTL III as of November 23, 2022, and to provide banks with additional dates for voluntary early repayment of these transactions. (Source: Agerpres)
Analysts are focused on ECB president Christine Lagarde’s press conference starting at 14:45 (CET), during which the head of the ECB will comment on the reasons behind Thursday’s decisions.
Source: Hot News RO
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