The European Central Bank (ECB) has raised its main interest rate for the 10th consecutive time, reaching a record 4%, in an effort to combat rising inflation, CNBC reports.
The move comes after new projections indicated that inflation in the euro area is expected to average 5.6% this year, up from a previous estimate of 5.4%.
The ECB suggested that further rate hikes might not be necessary, stating that the current rates should help bring inflation back to the target level.
Additionally, the ECB revised its economic growth projections downward, forecasting 0.7% growth in 2023, 1% in 2024, and 1.5% in 2025 for the euro area.
The euro depreciated in response to this announcement, falling to a three-month low against the US dollar.
Despite the rate increase, European stocks rallied, with the Stoxx 600 index rising by 1.1%.
