European Central Bank keeps rates on hold in the face of inflation threat
The European Central Bank decided to keep interest rates unchanged at 2% during its April meeting amid rising inflation driven by higher energy prices following the war in the Middle East. The bank acknowledged increased risks to both inflation and economic growth, emphasizing a data-dependent approach without committing to future rate moves. Inflation in the euro zone rose to 3% in April, prompting debate among economists about a potential rate hike at the June meeting.
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The European Central Bank kept interest rates on hold at its April meeting, despite a surge in inflation in the euro zone since the war in Iran began.The ECB's governing council opted to hold its benchmark deposit facility rate at 2% on Thursday.In a statement, the bank said that while its previous assessment of the inflation outlook was largely unchanged, "the upside risks to inflation and the downside risks to growth have intensified." It said its Governing Council remained committed to setting monetary policy to ensure that inflation stabilizes at the 2% target in the medium term.Acknowledging that the war in the Middle East had led to a sharp increase in energy prices, pushing up inflation and weighing on economic sentiment, the ECB noted that "the implications of the war for…
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