The European Central Bank on Thursday raised its key interest rates by an unprecedented 75 basis points to fight runaway inflation.

Following up on its July rate hike, the European Central Bank (ECB) raised its deposit rate to 0.75% from zero and lifted its main refinancing rate to 1.25%, their highest levels since 2011, with further moves anticipated in October and December.

“This major step frontloads the transition from the prevailing highly accommodative level of policy rates towards levels that will ensure the timely return of inflation to the ECB’s 2% medium-term target,” the ECB said in a statement.

The ECB has raised its inflation projections once again, lifting the 2023 outlook to 5.5% from 3.5% and putting the 2024 rate at 2.3%, above its 2% target.

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