The Strategist

ECB raises benchmark rate to 1.25% per annum for the first time ever

09/09/2022 - 11:35

At its meeting on Thursday, the Governing Council of the European Central Bank (ECB) increased its benchmark interest rate from 0.5% per year to 1.25% by 75 basis points, and anticipates similar hikes at the following few meetings.

"The three main interest rates of the ECB will increase by 75 basis points as per the Governing Council's decision.
As a result, starting on September 14, 2022, the interest rates for the key refinancing operations and the marginal lending and deposit facilities will be hiked to 1.25 percent, 1.2 percent, and 0.7 percent, respectively," the regulator said in a message.
In order to reduce demand and prevent the risk of sustained increases in inflation expectations, the Governing Council intends to raise interest rates even more in the upcoming meetings, according to its present assessment.