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The European Central Bank (ECB) raised its base lending rate by 0.75 percentage points to 2%. This is stated in a press release on the website of the regulator.
The reason for this decision in the ECB called the desire to reduce inflation to a medium-term target level of 2%. The regulator said that in the near future the rate increase will continue.
Other base rates have also been increased: the rate on deposits is now 1.5%, on short-term loans from the ECB – 2.25%.
The ECB raised rates earlier in 2022 in July (from 0 to 0.5%) and in September (to 1.25%).
Inflation in the eurozone in recent months is a record for the entire time of its existence. In September it reached 9.9%. The main reason for this is the rise in energy prices, which leads to higher prices for other goods and services.
The last time the ECB’s lending rate was at 2% was in 2009, during the global financial crisis.