MADRID, 14 Dic. (EUROPA PRESS) –
The Governing Council of the European Central Bank (ECB) decided this Thursday not to raise interest rates, so that the reference rate for its refinancing operations will remain at 4.50%, while the deposit rate remains the same. at 4% and the loan facility at 4.75%.
In this way, the issuing institute leaves rates intact for the second consecutive meeting since it stepped on the brakes at its October meeting after carrying out ten consecutive increases in the price of money, which placed it at its highest level in more than 20 years. .
“The previous increases in interest rates continue to be strongly transmitted to the economy. The tightening of financing conditions is slowing down demand, which is helping to reduce inflation,” the ECB said in a statement, in which has confirmed that economic growth “will continue to be weak in the short term.”
The ECB has stated that interest rates “are at levels that, if maintained for a sufficiently long period, will contribute substantially” to returning inflation to the 2% target.
The ‘guardian of the euro’ had raised rates by 450 basis points during the hike cycle, which began in July last year and which has now not been resumed in a decision that analysts already took for granted.
Looking ahead, the ECB will continue to apply “a data-dependent approach” to determine the appropriate level of tightening and duration of monetary policy.
The ECB’s decision comes after the euro zone’s annual inflation rate was 2.4% in November, half a percentage point below the price increase recorded in the previous month and its lowest reading since July 2021. By excluding the impact of energy, food, alcohol and tobacco from the calculation, the underlying rate moderated six tenths, to 3.6%.
Furthermore, Eurostat confirmed last week that eurozone GDP recorded a contraction of 0.1% in the third quarter compared to the previous three months, when it expanded by 0.1%.
Thus, the performance of the eurozone economy between July and September was significantly worse than that observed in the United States, where GDP increased by 1.3% quarterly, while it was also below the performance of the United Kingdom, which stagnated. in the third quarter.
