Lagarde comments at ECB press conference
FRANKFURT, Oct 27 (Reuters) – The European Central Bank raised its key interest rate by 75 basis points on Thursday to 1.5%, the highest level since 2009, and signalled an intention to start mopping up cash from the banking system to fight record- high inflation .
Following are highlights of ECB President Christine Lagarde’s comments at a news conference after the policy meeting.
“The depreciation of the euro has added to the buildup of inflationary pressures.”
“The labour market continued to perform well in the third quarter and the unemployment rate remained at the historically low level of 6.6% in August . While short-term indicators suggest that jobs were still being created in the third quarter, the weakening of the economy could lead to a somewhat higher unemployment in the future.””… high inflation continues to dampen spending and production . Severe disruptions in the supply of gas have worsened the situation further, and both consumer and business confidence have fallen rapidly, which is also weighing on the economy.””Demand for services is slowing after a strong performance in previous quarters when those sectors most affected by the pandemic-related restrictions reopened, and survey-based indicators for new orders in the manufacturing sector are falling.””Economic activity in the euro area is likely to have slowed significantly in the third quarter of the year, and we expect a further weakening in the remainder of this year and the beginning of next year .”
FRANKFURT, Oct 27 (Reuters) – The European Central Bank raised its key interest rate by 75 basis points on Thursday to 1.5%, the highest level since 2009, and signalled an intention to start mopping up cash from the banking system to fight record-high inflation.
“…high inflation continues to dampen spending and production.
“Demand for services is slowing after a strong performance in previous quarters when those sectors most affected by the pandemic-related restrictions reopened, and survey-based indicators for new orders in the manufacturing sector are falling.”
“Economic activity in the euro area is likely to have slowed significantly in the third quarter of the year, and we expect a further weakening in the remainder of this year and the beginning of next year.”
