ECB plans the raising of rates more

On Thursday, the European Central Bank key interest rates rose by an exceptional 75 basis points. The ECB is planning further increases, since fighting inflation is a priority for now.

Politicians are concerned about the sustainability of rapid price growth because it severely slows investments, forces people and households to spend their savings, and sets off an irreversible spiral of salaries and prices. Inflation has reached its highest level in 50 years and is likely to approach double digit.

As a reminder, the ECB significantly increased the deposit rate (from zero to 0.75%) and the main refinancing rate (up to 1.25%) in July this year. At the next few meetings, the ECB promised some changes. These figures are the highest since 2011.

ECB head Christine Lagarde said the expectation of further interest rate increases due to excessively high levels of inflation. She also recognizes the probability of inflation remaining higher than the target level for a long period of time.

Lagarde suggested that the rate increase can continue until early 2023. The head of the ECB added that it might take from 2 to 4 meetings to discuss this issue.