ECB Raises Base Interest Rate to 0.5% for 1st Time Since 2011
© THOMAS LOHNES
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MOSCOW (Sputnik) - The European Central Bank (EBC) announced on Thursday that it had raised the base interest rate by 50 basis points for the first time since 2011.
"The Governing Council decided to raise the three key ECB interest rates by 50 basis points. Accordingly, the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will be increased to 0.50%, 0.75% and 0.00% respectively, with effect from 27 July 2022," the regulator said in a statement.
According to ECB head Christine Lagarde, the baseline scenario of the European Central Bank does not assume a recession in the eurozone this year and next.
"Most recent evolution concerning the gas supply through Nord Stream 1 in particular is obviously a factor that we are taking into account, and the decisions that have been announced by the EU Commission in relation to savings, in relation to solidarity, in relation to inventory, are also taken into account in relation to the role that energy plays in relation to inflation, but also in relation to growth. So we are very attentive to all these factors. Is that going to lead to a recession? We look at our projection dating back to June, we look at the most recent forecast published by the commission last week and under the baseline scenario there is no recession neither this year nor next year. Is the horizon clouded? Of course it is," she said at a press conference following the ECB Governing Council meeting in Frankfurt.
"Most recent evolution concerning the gas supply through Nord Stream 1 in particular is obviously a factor that we are taking into account, and the decisions that have been announced by the EU Commission in relation to savings, in relation to solidarity, in relation to inventory, are also taken into account in relation to the role that energy plays in relation to inflation, but also in relation to growth. So we are very attentive to all these factors. Is that going to lead to a recession? We look at our projection dating back to June, we look at the most recent forecast published by the commission last week and under the baseline scenario there is no recession neither this year nor next year. Is the horizon clouded? Of course it is," she said at a press conference following the ECB Governing Council meeting in Frankfurt.
