Frankfurt, June 16 (BNA): The head of the International Monetary Fund (IMF) praised today, Friday, the decision of the European Central Bank to raise interest rates for the eighth time in a row, and its pledge to continue working as needed to reduce high inflation. AP reports.
Managing Director Kristalina Georgieva said the International Monetary Fund welcomed a quarter-percentage-point rate hike for the European Central Bank on Thursday and President Christine Lagarde’s pledge that the ECB “is not considering pausing”. The bank is trying to reduce inflation from 6.1% to its target of 2%.
The central bank of the 20 countries that use the euro is pushing ahead with raising interest rates even as the US Federal Reserve has paused its series of increases to assess its impact on the economy.
The European Central Bank is raising interest rates despite the potential impact on economic growth. While higher rates fight inflation by making it more expensive to borrow in order to buy or expand a business, which reduces demand for goods, they can also risk slowing the economy too much.
#IMF #welcomes #Europes #interest #rate #hikes #campaign #inflation