The head of the European Central Bank says interest rates will stay high enough to restrict business activity for “as long as necessary” to beat back inflation because upward pressure on prices “remains strong.”
if “maintained for a sufficiently long duration.” The bank sees inflation declining to an average of 2.1% in 2025 after hitting a record-high 10.6% in October.
Higher rates are central banks’ chief weapon against excessive inflation. They influence the cost of credit throughout the economy, making it more expensive to borrow for things like home purchases or building new business facilities. That reduces demand for goods and, in turn, inflation but also risksThe ECB’s higher rates have triggered a sharp slowdown in real estate deals and construction — which are highly sensitive to credit costs — and ended a yearslong rally in eurozone home prices.
Lagarde said the economy “broadly stagnated” in the first six months of this year and incoming data points to “further weakness” in the July-to-September quarter. She cited ECB forecasts that expect the economy to pick up as inflation declines, giving people more spending power. The Associated Press is an independent global news organization dedicated to factual reporting. Founded in 1846, AP today remains the most trusted source of fast, accurate, unbiased news in all formats and the essential provider of the technology and services vital to the news business. More than half the world’s population sees AP journalism every day.
Deutschland Neuesten Nachrichten, Deutschland Schlagzeilen
Similar News:Sie können auch ähnliche Nachrichten wie diese lesen, die wir aus anderen Nachrichtenquellen gesammelt haben.
Betting on a rate cut now is 'premature,' European Central Bank member saysIt is 'premature' to bet on a cut to interest rates, Francois Villeroy de Galhau, France's central bank governor, told CNBC exclusively on Monday.
Weiterlesen »
Betting on a rate cut is 'premature,' European Central Bank member saysIt is 'premature' to bet on a cut to interest rates, Francois Villeroy de Galhau, France's central bank governor, told CNBC exclusively on Monday.
Weiterlesen »
Thailand central bank to hold rates in Sept after seven straight hikes, Reuters poll showsThailand's central bank will leave its key policy rate unchanged at 2.25% on Wednesday and likely through 2024, marking an end to a year-long tightening cycle, according to a Reuters poll, though a few economists still expect one final hike.
Weiterlesen »
Thailand central bank to hold rates in Sept after seven straight hikesThailand central bank to hold rates in Sept after seven straight hikes - Reuters poll
Weiterlesen »
ECB’s Kazaks: September rate hike may allow a pause in OctoberEuropean Central Bank (ECB) Governing Council member, Martins Kazaks, commented on the central bank’s September rate hike decision. Kazaks said that “
Weiterlesen »