To cope with inflation, the European Central Bank decides to raise its interest rates more than expected, by 0.5 points

For the first time in more than ten years, the European Central Bank (ECB) announced on Thursday, July 21, an interest rate hike of 0.5 points – more than expected – in the face of galloping inflation. and the risk of recession. This decision marks a major turning point after a long period of easily accessible money in the euro zone.

The main interest rate thus goes from zero, where it has been camped since 2016, to 0.50%, while that taxing part of the bank liquidities not distributed in credit, negative since 2014, rises from -0.50% to zero .

The increase is greater than expected: in June, the ECB announced that the increase would be 0.25 points.

By raising the cost of credit, for the first time since 2011, the ECB is following in the footsteps of other central banks around the world. The US Fed has raised interest rates since March and its range for the federal funds rate, now between 1.5% and 1.75%, could be raised by 75 basis points at the end of July.

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