ECB raises main refinancing rate by 50bps to 3.00% as widely expected. The marginal lending facility and deposit facility rates are raised by the same amount to 3.25% and 2.50% respectively.
In accompanying statement, ECB said it will “stay the course” with today’s hike. Also, it said the “Governing Council intends to raise interest rates by another 50 basis points at its next monetary policy meeting in March.” Then, it will “evaluate the subsequent path of its monetary policy”.
“Keeping interest rates at restrictive levels will over time reduce inflation by dampening demand and will also guard against the risk of a persistent upward shift in inflation expectations,” ECBB added.
Also, the APP portfolio will “decline by €15 billion per month on average from the beginning of March until the end of June 2023”. PEPP  principal payments from maturing securities will by reinvested until the end of 2024.
