'Aftermath of war' inflation marches high... Europe raises interest rates for the first time in 11 years

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European Central Bank has also started raising interest rates.

The reason for the increase is because of rising prices.

The European Central Bank announced that it would raise the base rate from next month and raise it even more in September.

Correspondent Kim Ki-tae.

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European Central Bank (ECB) held a monetary policy meeting and announced that it would raise the key interest rate by 0.25 percentage points at its July meeting.

He also predicted that there would be a larger increase in September.

[Christine Lagarde/President of the European Central Bank: Looking a little further ahead, we expect the European Central Bank to raise its key rate further in September.]

In March 2016, the European Central Bank raised its key rate to 0%. After lowering it to , it has maintained it until now, but it is the first time in 11 years to raise the base rate.

The European Central Bank also raised its inflation forecast to 6.8% this year, 3.5% next year, and 2.1% in 2024.

He also predicted that “energy and food prices have risen considerably due to the effects of war,” and that “inflation rates will remain high for a considerable period of time.”

[Christine Lagarde/President of the European Central Bank: High inflation is a major challenge for all of us.

We will make sure that inflation returns to its mid-term target of 2%.]

The World Bank also drastically downgraded its global economic growth forecast for this year to 2.9% from the previous 4.1% in a recently released report, warning of the possibility of stagflation, which means rising prices amid an economic downturn.