Monetary authorities around the world are currently fighting against high inflation.
(Photo: Bloomberg)
Frankfurt, Dusseldorf, Berlin The European Central Bank (ECB) raised interest rates in the euro area more than ever before on Thursday. The key interest rate rises by 0.75 percentage points to 1.25 percent. The interest that banks get for their deposits at the ECB increases from zero to 0.75 percent.
ECB President Christine Lagarde justified the decision by the ECB with the high inflation of 9.1 percent in August. The interest rate move was quite controversial in the Governing Council: “We had different views at the table, a thorough discussion, but the result of our discussions was a unanimous decision,” said Lagarde.
Above all, representatives of southern European countries were recently in favor of smaller interest rate hikes because they are more manageable for the economy. Fritzi Köhler-Geib, chief economist at KfW, now praised the fact that the ECB had “resisted the economic Cassandra calls”.
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