The European Central Bank is Preparing to Raise Interest Rates

The European Central Bank (ECB) is expected to increase interest rates in July to combat inflation.

The European Central Bank is preparing to raise interest rates due to global inflation, many central banks have increased interest rates under the leadership of the Fed. Finally, sources close to the ECB stated that the bank will increase interest rates, which were at record lows, in July. Speaking at a conference in Brussels, Elderson stated that the bank's net asset purchases may end and "This will allow us to evaluate normalization in policy in July." Elderson added that the steps to be taken will depend on economic data and stated that although the post-pandemic recovery is weaker than expected, the possibility of a recession is not yet seen. Another Board Member, Francois Villeroy, spoke to a French radio channel. Villeroy stated that a gradual increase in interest rates could start from the summer. Stating that whatever is necessary to bring inflation closer to the 2 percent target, Villeroy said, "We are in a world full of uncertainties and we need to find the right way to adjust our monetary policy to reduce inflation without harming the economy." On the other hand, the ECB has not increased interest rates since 2011.