Today, Thursday, the ninth of June, the European Central Bank’s meeting, which will hold its periodic meeting in the middle of the European session, is topping the events to discuss monetary policy developments and interest rates, as the bank is expected to keep monetary policy and zero interest rates unchanged, as has been the case for years.

The last reading of inflation in the euro area issued last week, according to Eurostat estimates, came to an increase of 8.1% in May in the initial reading, recording its highest level in history, compared to 7.4% in the April reading, exceeding expectations that indicated a growth of about 7.7%, while the monthly reading of the index recorded A growth of 0.8% from 0.6%.

These rises will put pressure on the European Central Bank in its meeting today, and it is unlikely that it will ignore these rises, especially since the Russian gas and oil crisis and its rise in prices directly affect inflation in the euro area, and therefore it is not expected that inflation will decline soon before the problem is resolved, as are expectations in other economies. .

The bank hinted in its statements in May that it plans to raise interest rates in July, and therefore it is not expected, according to market estimates, that the bank will take a sudden step and raise interest rates at today’s meeting, but it is expected to start ending the monetary stimulus program and the asset purchase program today in preparation for starting to raise rates interest in July.

With strong inflation hikes and expectations that these increases will continue, investors are awaiting whether Lagarde will give some hint of the possibility of a 50 basis point increase, or will it stick to the hypothetical pace of 15-25 basis points at each meeting.

We can say that Thursday’s meeting of the European Central Bank will be the general meeting, given that it will determine the direction of the single currency in the coming period, and it will be a real test for the central bank, its credibility, and its way of dealing with high inflation, as any expectations of a strong interest rate hike of 50 basis points will strongly support the rises of the euro.

The European Central Bank is also expected to announce its economic forecast for the coming period, as the Bank is expected to lower its growth forecast and raise its inflation forecast.