ECB Raises Interest Rates Amid High Inflation and Lowered Growth Forecasts


In an unexpected move on Thursday, the European Central Bank (ECB) raised its key interest rates by 25 basis points, citing persistent inflationary pressures. The decision will come into effect from September 20, 2023. The ECB has increased the interest rate on the main refinancing operations, as well as the rates on the marginal lending facility and the deposit facility to 4.50%, 4.75%, and 4.00% respectively.


The ECB's decision comes as it lowers its growth forecasts and increases its inflation expectations for the Euro area. According to the ECB's latest macroeconomic projections, average inflation is expected to be 5.6% in 2023, followed by 3.2% in 2024, and finally cooling down to 2.1% in 2025. This represents an upward revision for 2023 and 2024 and a downward revision for 2025.


The central bank has also revised down the projected path for inflation excluding energy and food to an average of 5.1% in 2023, then decreasing to 2.9% in 2024, and further dropping to 2.2% in 2025.


In light of these developments, the ECB has significantly lowered its economic growth projections for the Euro area. The bank now expects the economy to expand by a mere 0.7% in 2023, improving slightly to 1.0% in 2024, and further to 1.5% in 2025.


This tightening of monetary policy is expected to impact domestic demand and the international trade environment negatively. The ECB noted that increasingly tighter financing conditions are dampening demand, which it sees as a crucial factor in bringing inflation back to its target of around 2%.


Despite these significant policy changes, the gold market did not react significantly to the ECB's latest decision. Spot gold against the euro last traded at €1,782.44 an ounce, up 0.24% on the day. In comparison, spot gold against the dollar remained roughly unchanged, last traded at $1,908.60 an ounce.


Source : Economy News by / September 14, 2023


240 rue Evariste Galois,

06410 Biot,

Sophia Antipolis

Automata Pay

65-66 Warwick House 4th

Floor, Queen Street, London

England, EC4R 1EB

Automata ICO Ltd

3rd Floor Ormond Building,

31-36 Ormond Quay Upper,

Dublin 7, D07 Ee37

Automata Pay Europe Ltd

3rd Floor Ormond Building,

31-36 Ormond Quay Upper,

Dublin 7, D07 Ee37

Automata ICO Ltd

Italian Branch

Via Archimede, 161,

00197 Roma


Automata ICO Limited, a Company incorporated in Ireland with its registered office at 3rd Floor Ormond Building, 31-36 Ormond Quay Upper, Dublin 7, D07 Ee37, Ireland registered in Ireland under number 690280 has applied for a Virtual Asset Service Provider registration with the Central Bank of Ireland. Whilst the application is ongoing, we are permitted to continue business as a Virtual Asset Service Provider in line with the Central Bank of Ireland's regulatory disclosure statement as required under section 106L of the CJA 2010 in relation to registered VASPS.

Automata ICO Limited, a Permanent Establishment incorporated in Italy with its registered office at Via Archimede, 161, Roma, Italy, and registered in Italy under number 96550860587 with the Organismo Agenti e Mediatori (OAM) as a Virtual Asset Service Provider (VASP).

Automata France SAS is a company registered in France with the company number 902 498 617. Automata FRANCE SAS is registered with the french Financial Market Authority, l’Autorité des marchés financiers (“AMF”), as a provider of Virtual Asset Service Provider under number E2023-087.