Monetary Policy

The latest macroeconomic projections, which were discussed by the Governing Council at its meeting, indicate that owing to the persistent conflict in the Middle East, inflation in the euro area will be higher this year than forecast in the previous projections, and economic growth slightly lower. Under the assumption of the normalisation of the situation in the Middle East and an easing of energy prices, our expectation is that the situation will gradually stabilise over the next two years. Under these circumstances the Governing Council took the decision to raise the key interest rates by 25 basis points, after a long period of no change in the monetary policy stance.