ECB Raises Interest Rates to Tame Energy-Driven Inflation

The European Central Bank (ECB) has raised interest rates by a quarter percentage point to 2.50% in an effort to combat inflation fueled by high oil prices.

The decision was made at a meeting held in Berlin, away from the ECB's Frankfurt headquarters, and was supported by a stronger-than-expected economy that suggests businesses can weather higher borrowing costs.

ECB President Christine Lagarde said that 'the conflict in the Middle East continues to generate inflation pressures, and inflation is set to remain well above target for an extended period.'

The bank's last rate increase was on June 11, followed by a pause at its July 23 session. Remarks from Lagarde later Thursday will be closely watched for clues about future interest rate decisions.