ECB meets market expectations as Governing Council takes further step towards policy normailsation.
The European Central Bank raised its 3 key interest rates by 75 bps Thursday, pushing the current benchmark deposit rate to 1.5%. The move was largely expected by financial markets, with the move well priced in, as policymakers continue their fight with inflation.
The Governing Council also moved to adjust the rates on the outstanding TLTRO 3 operations, with the new terms applicable from November 23. The move had been highlighted by MNI in the run-up to the October meeting (MNI ECB WATCH: ECB Eye TLTRO Changes As Depo Rate Set For 1.5%).
Although the ECB offered no explicit forward guidance, the policy statement said further rate hikes were expected to ensure the timely return of inflation to the 2% medium-term inflation target.