European stocks hold firm, euro inches higher after ECB raises rates
By Scott Kanowsky
Investing.com -- European stocks held largely steady, while the euro inched up against the dollar and government bond yields in Germany fell after the European Central Bank raised its key interest rates by 50 basis points on Thursday.
At 09:35 ET (13:35 GMT), the regional Stoxx 600 dipped slightly by 0.12%, the DAX index in Germany grew by 0.23%, and France's CAC 40 gained 0.49%.
Meanwhile, the EUR/USD was slightly improved versus the greenback by 0.12% to 1.0589. Yields, which move inversely to prices, on benchmark 10-year German sovereign debt slipped.
The interest rate on the ECB's main refinancing operations will rise to 3.50%, while the deposit facility rate will rise to 3.0% and the marginal lending rate to 3.75%.
The bank vowed to press on in its fight to corral price growth and said it will continue to reduce its balance at the current rate of around €15 billion a month.
"Inflation is projected to remain too high for too long," the ECB said in a statement.
It pointed to its latest set of forecasts that show inflation still running just above the bank's medium-term target of 2% in 2025. At the same time, it raised its growth forecasts for the single currency bloc, and now sees GDP growth of 1% this year. It also revised up its forecasts for 2024 and 2025.
However, the bank dropped from its statement any reference to further interest rate hikes, a significant shift from its previous messaging. That comes in a week when global financial markets have been rattled by the collapse of three mid-sized U.S. banks, and by concerns for the viability of Swiss lender Credit Suisse , one of the world's 'systemically important' banks. Credit Suisse (SIX: CSGN ) was handed a $54B lifeline and a vote of confidence by the Swiss National Bank (SIX: SNBN ) overnight.
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