A move prepared over months, confirms inflation target while reducing economic uncertainties The European Central Bank's Executive Board discussed whether an interest rate increase was appropriate but ultimately decided unanimously on maintaining rates unchanged due to current uncertainty and stable medium-term inflation, according to ECB President Christine Lagarde during a press conference. Despite rising energy prices continuing to rise and the 'energy shock still showing its effects', for the Executive Board, "so far, medium-term inflation has remained largely stable and wage increases have not significantly reacted in this phase".

Lagarde has warned: "The greater magnitude and duration of energy shocks along with their indirect effects will likely lead to an increase in inflation and weaken economic growth". The ECB explained that "Energy prices have exceeded the path outlined by the ECB's September staff projections. This is expected to further push up short-term inflation and keep overall inflation above its objective for the next quarters", added Lagarde during a press conference.

Following that, a decrease in energy inflation, combined with higher interest rates, should help bring inflation back on track, according to the directive. The Council notes that it remains favorable for addressing current high uncertainty. To define an appropriate monetary policy orientation, "it will follow an approach guided by data, where decisions are taken at each meeting". This move is considered an important step in managing current economic uncertainties, which have been exacerbated by global oil price increases and the energy shock crisis.

The main objective is to keep inflation under control and protect economic growth from rising price pressures. However, even if interest rates remain unchanged, economists are concerned about how these movements could impact future economic growth and inflation. The ECB has clarified that it's not a definitive decision but rather a measured strategy based on available information with the aim of maintaining an economy in a state of stability and security.

In conclusion, while the interest rate remains unchanged, the ECB continues to closely monitor economic conditions and global uncertainties, ready to adopt further measures if necessary to ensure the effectiveness of its monetary policy.