European Central Bank increases main deposit rate to 2.25%, with two further rises expected by next spring

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The European Central Bank has raised interest rates for the first time since 2023 in response to higher inflation caused by the war in Iran.

The ECB raised its main deposit rate from 2% to 2.25% in a move that financial markets expect to be the first of three rises by next spring.

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© Photograph: Kirill Kudryavtsev/AFP/Getty Images

© Photograph: Kirill Kudryavtsev/AFP/Getty Images

© Photograph: Kirill Kudryavtsev/AFP/Getty Images

The European Central Bank raised interest rates for the first time since 2023. It expects inflation to run hotter than previously thought, and downgraded its forecast for economic growth.

© Samuel Aranda for The New York Times

As the war in Iran persists, signs point to a prolonged period of higher prices and slower growth rather than a quick shock.

© Violette Franchi for The New York Times