European Central Bank policymakers at their meeting last month appeared increasingly concerned that high inflation is getting entrenched and the risk was large enough to warrant a bigger-than-flagged rate hike, the accounts of the July 21 meeting showed.
The ECB raised interest rates by 50 basis points to zero last month as inflation fears mounted, surprising investors with an unexpectedly large hike after the central bank had guided for a smaller, 25 basis-point move.
"Inflationary pressures were judged to have intensified," the accounts, released on Thursday, showed. "Continued anchoring of inflation expectations was dependent on the Governing Council acting decisively on the worsening inflation outlook."
The ECB is expected to lift rates by another 50 basis points next month, even as the risk of a recession is rising, as inflation is now nearing double-digit territory and looming gas shortages could push prices even higher.
