The European Central Bank (ECB) does not want to react immediately with the same step after the US Federal Reserve has raised the key interest rate again. “We are not the same, nor can we move forward at the same pace and under the same diagnosis of our economies,” ECB President Christine Lagarde said at a conference in Latvia’s capital Riga on Thursday. “We are not in the same situation.” In particular, the situation on the labor market in the United States differs greatly from that in the euro zone.
Sixth rate hike in 2022
At the same time, there is a great deal of mutual dependence on the financial markets. “We have to look out for each other and we have to be alert to potential spillovers and repercussions,” Lagarde said. In the fight against high consumer prices, the US Federal Reserve had previously increased its key interest rate by 0.75 points for the fourth time in a row on Wednesday. It is now in the 3.75 to 4.00 percent range. It is the sixth rate hike this year.
“We are also affected by the fallout, particularly through financial markets, to a lesser extent through trade as exchange rate obviously plays a role and needs to be factored in and factored into our inflation forecasts,” Lagarde said of the Fed’s decision. The ECB President attended a conference of the Central Bank of Latvia in Riga on the occasion of its 100th anniversary.