ECB raises interest rates
07-08-2008 15:06
It was already expected the last few months and now the very first interest raise by the European Central Bank (ECB) came through. The ECB raised interest rates with 0.25%. The current rate is therefore now 4.25%. According to analysts, the rates can be expected to be further raised to 4.5% this year. The reason for raising the rates is the ever growing inflation in the Euro zone. According to the statistic agency ‘Eurostat’, the current inflation is already 4%. The president of the ECB, Jean-Claude Trichet, said that raising the rates was necessary to secure price stability. The ever raising oil price is one of the main causes of the growing inflation. The European Central Bank perceives the growing inflation is being the number one thread for the economy.
The European stock markets all responded negatively to the decision by the ECB. They all opened lower.
