ECB ends bond purchases and announces first interest rate hike

Europe’s monetary guardians are responding to record inflation with the first interest rate hike in eleven years. The Governing Council of the European Central Bank (ECB) announced on Thursday that it intends to raise key interest rates in the euro zone by 25 basis points in July. For the time being, however, the key interest rate will remain at the record low of zero percent, and banks will still have to pay 0.5 percent interest on money parked at the ECB. ECB President Christine Lagarde had held out the prospect of ending negative interest rates by the end of September.