Central Banks
ECB Is Doubling Down on Rate Hikes Just as a Recession Bites
- While pace of rate increases slows, Lagarde vows more to come
- Aggressive action getting riskier as euro zone faces recession
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The European Central Bank’s warning that aggressive interest-rate hikes are far from over is raising the stakes for the euro region, just as a recession takes hold.
Every increase in borrowing costs, including Thursday’s half-point move, advances the fight by Frankfurt officials against rampant inflation — but also risks a higher toll on the economy. The trade-off means the potential cost of an error is rising with each decision.