Tuesday, February 7, 2023

European Central Bank raises rates, but at a slow pace

FRANKFURT, Germany ( Associated Press) — The European Central Bank raised its key interest rate on Thursday to tackle inflation, in line with decisions taken by central banks in countries such as the United States, albeit at a lower level than at other times this year. Feather. USA, Switzerland and England.

The global campaign by central banks against rising consumer prices has slowed down somewhat as inflation has seen a modest decline. But officials insisted inflation was still not under control and more rate hikes were on the way to fight rising energy, food and housing prices that are eroding consumer finances.

The ECB’s rate hike of half a percentage point at Thursday’s meeting in Frankfurt, Germany – still a sizeable increase – was less than the record three-quarter point adjustments in July and October. On Wednesday, the Federal Reserve, the US central bank, hiked its key rate by 50 basis points after a consecutive 75-basis increase.

The national banks of Switzerland and England also raised their rates by half a point on Thursday, while Norway adjusted by a quarter point. Inflation has eased in the UK, US and Europe but households remain under pressure due to food, energy and housing costs.

Inflation in the 19 countries that use the euro fell to 10% last month from 10.6% in October. This was the first decline since June 2021, but still well above the ECB’s 2% target.

The ECB’s chief economist Philip Lane said in an interview with the Milano Finanza newspaper that despite the decline, it is “too early” to say that inflation has peaked.

Nation World News Desk
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