ECB may raise rates on July 21

ECB may raise rates on July 21

sIt’s not certain yet, but signs are increasing: in July, European Central Bank (ECB) to raise interest rates for the first time in more than ten years. In concrete terms, it will likely be Thursday, July 21, when the ECB Council, the central bank’s apex monetary policy body, will meet on that day – an interest rate meeting that would then have earned its name for the first time in years. The first press release is expected at around 1.45 pm, after which ECB President Christine Lagarde will insist on explaining the details in a press conference. There is no doubt that the daily news that evening will also feature prominently about the first-ever increase in interest rates in the euro area.

It is expected that the central bank will be somewhat cautious about the rate hike for the first time and that too. interest charges An increase of only 0.25 percentage points. Anything else would be impossible, says economist Carsten Junius. Even America’s central bank, the Fed, took the first step. It is still somewhat unclear whether the ECB will raise all three key interest rates – the deposit rate, the prime refinance rate and the top lending rate – in parallel, as was usually the case in the past, or just the deposit rate earlier. The latter determines how much after tax allowance banks have to pay for their deposits in ECBs. This interest rate is currently minus 0.5 percent. Even after the increase of 0.25 per cent for the first time, this minus will remain 0.25 per cent.

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