ECB Hikes Rates Amid Persistent Inflation Pressures

The European Central Bank (ECB) raised its deposit rate by 25 basis points to 2.50% in response to persistent inflationary pressures and a stronger-than-expected eurozone economy.

The ECB's Governing Council warned that inflation will remain 'well above target for an extended period,' citing the ongoing conflict in the Middle East as a key contributor to rising prices.

New projections released by the ECB suggest that headline inflation will reach 3.0% in both 2026 and 2027, while core inflation is expected to remain above target through 2028, at 2.3%.