FRANKFURT: The European Central Bank on Thursday said eurozone inflation was still too elevated as it hiked interest rates for an eighth consecutive time to a two-decade high, despite a darkening economic outlook. The ECB increased rates by another 25 basis points, taking the closely-watched deposit rate to 3.50 per cent \u2014 its highest level since 2001. \u201cInflation has been coming down but is projected to remain too high for too long,\u201d the ECB said in a statement. Policymakers were \u201cdetermined to ensure\u201d a return to the bank\u2019s two-percent target, and will keep rates at sufficiently restrictive levels \u201cfor as long as necessary\u201d, it added. The quarter-point hike was widely pencilled in by analysts. They were instead hoping president Christine Lagarde would use her 1245 GMT Frankfurt press conference to shed light on whether the ECB\u2019s unprecedented campaign of monetary policy tightening was nearing the summit. In the United States, the Federal Reserve on Wednesday held off from raising interest rates again after 10 straight increases. But the Fed indicated more hikes were likely before the end of the year as inflation remains double the bank\u2019s target rate. Web Desk
\nIn the euro region, the ECB has hiked borrowing costs at the fastest rate ever to tame inflation after Russia\u2019s war in Ukraine sent food and energy prices soaring, raising rates by 3.75 percentage points since last July.
\nEurozone inflation slowed to 6.1pc in May year-on-year, down from a peak of 10.6pc in October, mainly thanks to rapidly falling energy costs.
\nThe ECB said its inflation-fighting efforts were \u201cgradually having an impact across the economy\u201d, with loan demand slowing sharply in the eurozone as higher borrowing costs take their toll on households and firms.<\/p>\n","protected":false},"excerpt":{"rendered":"
FRANKFURT: The European Central Bank on Thursday said eurozone inflation was still too elevated as it hiked interest rates for an eighth consecutive time to a two-decade high, despite a darkening economic outlook. The ECB increased rates by another 25 basis points, taking the closely-watched deposit rate to 3.50 per cent \u2014 its highest level […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[],"class_list":{"0":"post-338246","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-business"},"yoast_head":"\n