ECB Raises Rates To 2.5%

The European Central Bank raised its key deposit rate by 25 basis points to 2.5% at its Sept. 10 policy meeting, the second increase since June. Officials said inflation risks had risen as the war involving Iran drove energy prices higher, with Brent crude topping $105 a barrel and eurozone inflation at 3.3%, above the ECB’s 2% target. The ECB also signaled a weaker growth outlook as European bond yields reached multi-decade highs. The move focused attention on the Federal Reserve, with markets pricing a 64% to 70% chance of a U.S. rate increase next week.