ECB summary – 21 June 2022

Although not an official meeting of the European Central Bank, at a hearing in the European Parliament’s Economic and Monetary Affairs, Christine Lagarde made some very important comments.

She reaffirmed her intention to raise her key interest rate both in July and September. It will be a hike of around 0.25% in July but left the September rate open. He also reinforced that despite the economic turbulence generated by the conflict between Ukraine and Russia, the ECB’s main focus is on fighting inflation.

She also talked about the new tool to help prevent a new debt crisis in Europe. They have accelerated plans to fight fragmentation, which is the disparity in funding costs between different European countries.

It seems to have produced some good results and reduced costs, at least for now, there is the problem of the current macroeconomic cycle. Most central banks are raising their benchmark interest rates, which will most likely drive up interest rates on debt as well, particularly in the larger debt countries like Portugal, Greece, and Italy.

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