ECB Policymakers Might Be Converging on a 25-Basic Pints Rate Hike Next Month
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Five sources with direct knowledge of the discussion have reported that the European Central Bank (ECB) is gravitating towards a 25 basis point interest rate hike in May, although other possibilities are still under consideration.
The ECB has raised rates by 50 basis points at each of its last six meetings in order to combat persistent inflation. However, the sources, who requested anonymity, point to a range of factors that advocate for greater caution.
These include a lingering uncertainty in the wake of last month’s financial turbulence, the need to allow prior rate hikes to take full effect, a peak in rates close at hand, and the fact that the current 3% deposit rate is constraining economic growth.
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