Once again, the President of the European Central Bank (ECB), Christine Lagardeconfirmed today by those who predicted the continuation of the upward trend interest rates. In particular, he said that it is “very likely” to raise interest rates by another 50 basis points at the ECB meeting on March 16.

In particular, speaking to the Spanish newspaper El Correo, Lagarde said that this is a decision that she has already referred to since the previous meeting, “and all the numbers that we see in recent days confirm that this increase is very likely.” as reported by moneyreview.gr in its publication.

However, if such an increase is indeed passed at the March 16 meeting, the base rate will increase by a total of 350 basis points since last July. While it’s unclear what will happen after March, analysts are discounting the value of money by up to 4% from the current level of 2.5%. And if something like this happens, it will be the first time in the history of a single European currency. “I can’t tell you how high interest rates will be. I know that they will be higher than they are now and that we still have a lot of work to do because we still can’t keep the win. We are clearly making progress, but we still have work to do,” Lagarde said.

Increase in the cost of borrowing by 50 m.p. next week is very likely, stressed the president of the ECB.

It is no coincidence that he described inflation as a monster that needs to be beaten on the head.

It is noted that, according to preliminary data from the European Statistical Service, the inflation index in the Eurozone fell slightly in February to 8.5% compared to 8.6% in January. More worrying, however, is the fact that core inflation rose to a record high of 5.6% from 5.3% the previous month. “I am confident that structural inflation will decline in 2023 if inflation remains uncomfortably high in the short term. And I expect relatively better economic growth than the stagnation of the last quarter of 2022,” he said. She also recalled that “ECB forecasts do not include a recession in 2023. We expect positive growth and increased activity throughout the year. However, it is true that there is a lot of uncertainty.” As for the risks to growth, Lagarde stressed: “Our main concern is inflation. We don’t want to shake up and destroy the economy. This is not our goal. Our goal is to suppress inflation.”

In conclusion, according to Marco Valli, Chief Economist and Head of European Affairs at the Italian bank UniCredit, in an interview with the Financial Times, the latest data on structural inflation at 8.5% and 5.6% in February, which was strengthened, “may have influenced policy of the European Central Bank, because its members on the board of directors of influential countries have directly linked the exchange rate of the value of money with structural inflation and its evolution.