00:02The European Central Bank has raised interest rates for the first time in nearly three years
00:07in response to the rising inflation fueled by the U.S. and Israel's war on Iran.
00:12The bank lifted its deposit facility rate from 2% to 2.25% following its governing council meeting on
00:20Thursday.
00:21The ECB sets monetary policy for the Eurozone through three key interest rates.
00:26The ECB's deposit facility rate was last raised in September 2023
00:31when it reached its peak of 4% to stabilize the post-pandemic inflation crisis.
00:37Inflation in the Eurozone hit 3.2% in May, its highest level since September 2023,
00:43driven by a 10.9% surge in energy prices.
00:46Meanwhile, the bloc's economy shrank by 0.2% in the first quarter of 2026,
00:52prompting economists to warn of a period of stagflation,
00:56combining weak growth with rising inflation.
00:59For households and businesses across the 21-country bloc,
01:03the decision translates into higher borrowing costs on mortgagees and corporate loans
01:07at a time when purchasing power is already being squeezed by elevated fuel and gas prices.
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01:14who purchased the U.S.
01:17the public isstar
01:17numerous
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