The European Central Bank decided in its meeting moments ago today, Thursday, July 27, to raise interest rates by 25 basis points, as expected, to reach 4.25%.
The bank’s interest statement stated that inflation continues to decline but is still expected to remain high for a very long time and the Board is determined to ensure that inflation returns to its 2% target in due course. The bank’s future decisions will ensure that key central bank interest rates are set at sufficiently restrictive levels to bring inflation back to target in a timely manner, and a data-driven approach will be used to determine the appropriate level.
The Board declared that the APP portfolio is declining at a measured and predictable pace as the Eurosystem no longer reintroduces principal payments from outstanding securities.
With regard to the PEPP program, the Board intends to reinvest the principal payments purchased until at least the end of 2024. After less than half an hour, the markets are waiting for the bank’s president Christine Lagarde’s press conference to answer journalists’ questions.
01/11/2024
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