The European Central Bank (ECB) is maintaining its benchmark interest rate of two percent at a rate meeting on Thursday. The central bank wrote in a press release.
The bank points out in the statement that inflation has increased and that there is a risk of lower growth. The development must be seen in light of the war in the Middle East and the rising energy prices, which are a consequence of the war. The ECB will monitor the development of inflation and growth closely in the coming time in order to adjust its monetary policy, it says.
According to chief economist Las Olsen from Danske Bank, it is unclear what will happen to interest rates now that the ECB has made its interest rate announcement.
- There is no clear arrow in the decision on what will happen next. The bank notes that high energy prices mean both higher inflation and lower growth prospects, which means that it could point both up and down for interest rates, says Las Olsen in a written comment.
He adds that he sees it as "fairly likely" that the European Central Bank will respond to the higher prices with interest rate hikes at their upcoming meetings.
/ritzau/
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