ECB, rate hikes and embezzlement of public funds - Finance

ECB initiates historic rate hike – Finance

Faced with record inflation, the European Central Bank (ECB) on Thursday put an end to its monetary support for the economy, ending years of net asset purchases and planning the first increase for the end of July, in more than ten years, of its key rates.

The European Central Bank (ECB) announced on Thursday a first increase in its interest rates of 0.25 points “in July” in an attempt to stem galloping inflation in the euro zone, a historic turning point after more than ten years of lowest rate.

While the other major central banks have already begun to tighten monetary policy, euro guardians “intend to raise interest rates by 25 basis points at the July meeting,” before “ another hike in September,” according to a statement released after a meeting of the ECB’s Governing Council.

The ECB also announced that it was going to put an end “on July 1” to its net purchases of assets, a prerequisite before starting to raise its rates during the same month to fight against galloping inflation in the euro zone.

The institute will however continue to “reinvest, in their entirety”, the securities of its portfolio maturing, according to the press release.

These debt buyback programs launched in 2015 had made it possible to maintain favorable borrowing rates for households, companies and States, in a context of sluggish inflation.

Forecast of inflation raised and growth lowered for 2022 and 2023

The European Central Bank (ECB) has also raised its inflation forecasts, while lowering that of GDP growth, for the years 2022 and 2023 in the euro zone, due to the war in Ukraine which will “continue to weigh on the economy”. ‘economy”.

For the euro zone, the institution now expects inflation of 6.8% in 2022which should then slow down to 3.5% in 2023and stay with 2.1% in 2024 always above its target 2%.

GDP growth is expected to reach 2.8% in 2022 in the euro area, before 2.1% in 2023according to new ECB forecasts released in a statement after a monetary policy meeting.

The European Central Bank (ECB) announced on Thursday a first increase in its interest rates of 0.25 points “in July” in an attempt to stem galloping inflation in the euro zone, a historic turning point after more than ten years of With the other major central banks having already begun to tighten their monetary policy, the guardians of the euro “intend to raise interest rates by 25 basis points at the meeting in July”, before “another rise in September”, according to a press release published after a meeting of the Governing Council of the ECB. The ECB also announced that it would end its net asset purchases on July 1, a prerequisite before starting to raise its rates during the same month to fight against galloping inflation in the euro zone. However, the institute will continue to “reinvest, in their entirety”, the securities in its portfolio maturing, according to the press release. These debt buyback programs launched in 2015 had made it possible to maintain favorable borrowing rates for households, companies and States, in a context of sluggish inflation. Forecast of higher inflation and lower growth for 2022 and 2023The European Central Bank (ECB) also raised its inflation forecasts, while lowering that of GDP growth, for the years 2022 and 2023 in the euro zone, due to the war in Ukraine which will “continue to weigh on the economy”. For the euro zone, the institution now expects inflation of 6.8% in 2022, which should then slow to 3.5% in 2023, and remain with 2.1% in 2024 still above its 2% target. GDP growth is expected to reach 2.8% in 2022 in the euro zone, before 2.1% in 2023, according to new ECB forecasts published in a press release after a monetary policy meeting.

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