The ECB raises rates again and announces a new hike in July. Salvini: “It damages families and businesses”

A new hike, the eighth in a row, and it won’t be the last. The European Central Bank raised interest rates by 25 basis points, as widely expected by the markets. Interest rates on the main refinancing operations, the marginal lending facility and the deposit facility thus rise to 4%, 4.25% and 3.50% respectively. “Inflation has declined but is expected to remain too high for too long a period of time. The Governing Council is determined to ensure the timely return of inflation to the 2% objective over the medium term. It therefore decided today to raise the three key interest rates by 25 basis points.” To achieve this goal, the president then explained better Christine Lagarde during the press conference, “it is very probable that we will continue to raise rates in July”. The bullish maneuver will continue “until there is a material change” in the dynamics of inflation, he clarified, adding that the decision was taken with “a very broad consensus”. The decision comes in the aftermath of the choice of the Fed, which, as expected, temporarily halted the rate hike without excluding new increases in the coming months.

The forecasts, according to Frankfurt, are still gloomy: inflation is expected at 5.4% in 2023, 3.0% in 2024 and 2.2% in 2025, while growth has been revised downwards to 0 .9% in 2023, then rising to 1.5% in 2024 and settling at 1.6% in 2025.

Shortly before the Eurotower announced the tightening, the deputy prime minister and infrastructure minister Matthew Salvini he had commented on the latest monetary policy decisions. “The ECB realizes that with its policy it may reduce inflation by zero point, but is it damaging families and businesses?”, He said speaking at the Confcooperative meeting. “I would like economic and infrastructure policy to not just follow algorithms,” she added.