The European Central Bank hikes rates again to 3.5%

[Social Media]

The European Central Bank has pressed ahead with another interest rate hike, aiming to crush inflation that is driving up the cost of groceries, utility bills and summer vacations.

 

The ECB increased its benchmark rate by a quarter-percentage point, to 3.5 per cent on Thursday, a day after the US Federal Reserve took a break from its own string of increases.

In Europe, it was the eighth straight increase since July 2022, an unprecedentedly swift campaign to tighten the flow of credit to the economy as the bank seeks to return inflation to its target of two per cent from 6.1 per cent.

The decision was widely expected, and many analysts think one more quarter-point hike is in the cards for the bank’s next meeting on 27 July.

 

ECB projections acknowledge that controlling inflation will take months longer, even after the rate has fallen from a double-digit peak late last year.

“Are we done? Have we finished the journey? No, we’re not at the destination," she said at a news conference. "Do we still have ground to cover? Yes, we have ground to cover.”

[Tom H]

4%, not 3.5%.
Chat GPT mistake?

[JonnyF]

More bad news for the EU economy.

 

Maybe they can create some more rules and regulations to get out of the current mess?

 

https://www.euronews.com/2023/06/08/europes-economy-enters-technical-recession-as-households-struggle-with-cost-of-living-cris

 

 

I guess they are missing the Billions of Euros pumped into their economy by the UK every year after all...

[RayC]

6 hours ago, JonnyF said:

More bad news for the EU economy.

 

Maybe they can create some more rules and regulations to get out of the current mess?

 

https://www.euronews.com/2023/06/08/europes-economy-enters-technical-recession-as-households-struggle-with-cost-of-living-cris

 

Agreed. Not good news for the Eurozone. Although I'm not sure what new rules and regulations would help. Perhaps you could elaborate please?

 

6 hours ago, JonnyF said:

I guess they are missing the Billions of Euros pumped into their economy by the UK every year after all...

The +/-£10bn UK contribution to the EU would, no doubt, be welcomed by the ECB, but perhaps Jeremy Hunt had better hang on to the money himself. It will go a little way towards offsetting the £33bn loss in trade due to Brexit.

 

As Barnier said, there are no winners from Brexit.

[candide]

7 hours ago, JonnyF said:

More bad news for the EU economy.

 

Maybe they can create some more rules and regulations to get out of the current mess?

 

https://www.euronews.com/2023/06/08/europes-economy-enters-technical-recession-as-households-struggle-with-cost-of-living-cris

 

 

I guess they are missing the Billions of Euros pumped into their economy by the UK every year after all...

Bad news for anyone, including for a country making 40% of its trade with the EU, not to mention the fact that the three main European trade partners of UK (Germany, Netherlands and Ireland), are the most affected by recession.

[JustAnotherHun]

Bad in the short run, but it was high time to stop the only cash-driven groth.

Necessary to fight inflation and at least good for millions of small savers who don't have the options that wealthy people have and who are those to see their savings melting away day by day.

 

Remeber times where interest rates were much higher than now and it did not endanger groth. Becaus it was not only driven by expending the money supply.