The European Central Bank does not intend to raise interest rates for a while after it ended its bond purchases at the end of the third quarter, ECB President Christine Lagarde said on Thursday.
Lagarde said in a press conference, “any new ECB interest rate adjustment will be implemented after the end of the bond purchase under the APP and it will be done gradually.
Planning for key ECB interest rates will continue to be determined by guidelines set by the Governing Council and inflation stability at 2% in the medium term.
The ECB stated at a meeting that it plans to end asset purchases in the third quarter, accelerating its exit from the stimulus program as inflation continues to soar coupled with the Ukraine-Russia conflict.
On Wednesday, the market expects a 30 basis point increase in the ECB deposit rate by December and pushes it to -0.2%.
Investors have reduced their bets on rate hikes since Russia began its invasion of Ukraine on 24 February. The conflict on the eastern border of the european zone is expected to slow growth and make the ECB more cautious in tightening its policies.
"The Governing Body expects the ECB's key rates to remain at current levels until it sees inflation hit 2% earlier," Lagarde said.
