ECB Hikes Deposit Rate Amid Energy Price Fears

The European Central Bank (ECB) has raised its interest rates in an effort to combat inflation fears, following the recent surge in energy prices and the escalation of the Iran war. On Thursday, the ECB Governing Council, led by President Christine Lagarde, increased the deposit rate by 25 basis points to 2.50 percent.

The main refinancing rate was also raised by a similar size to 2.65 percent, while the lending rate was lifted to 2.90 percent.

The move is aimed at countering the potential inflation shock caused by rising energy costs, which have been exacerbated by the ongoing conflict in Iran.