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Essentials of Monetary Policy

European Central Bank (ECB). ECB Ends Era of Negative Interest Rates

July 21, 2022
Hendrix Vachon
Principal Economist

In June, the ECB signalled it would raise rates by 25 basis points. But with eurozone inflation recently hitting 8.6% and threatening to become entrenched, the ECB had to take more aggressive action. Today’s move also ends eight years of negative interest rates. One of the main upside risks to inflation the ECB cited was highly uncertain natural gas supplies.