“The interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will be increased to 4.00%, 4.25%, and 3.50% respectively,” the ECB said in a statement.

While the eurozone fell into recession, the eighth consecutive interest rate hike was aimed at persistent inflation.

“The Governing Council is determined to ensure that inflation returns to its 2% medium-term target in a timely manner,” the bank said.

Year-on-year inflation in the bloc decelerated to 6.1% in May, but it remained more than three times the bank’s two-percent target.

On Wednesday, the US Federal Reserve paused its recent series of interest rate increases but warned that inflation remained “elevated” and implied that rates might rise again this year.

The Fed’s benchmark lending rates will therefore remain between 5.0% and 5.25%, following 10 consecutive increases, in a bid to bring inflation accelerated by Russia’s invasion of Ukraine under control.

source dw.com