Under these conditions, the Governing Council of the ECB, at its meeting of 7 April 2011, decided to increase the key ECB interest rates by 25 basis points, after maintaining them unchanged for almost two years at historically low levels. This step was warranted to adjust the very accommodative monetary policy stance in the light of upside risks to price stability.
Indeed, it is essential that recent price developments do not give rise to broad-based inflationary pressures over the medium term through second round effects. Our decision to raise rates will contribute to keeping inflation expectations in the euro area firmly anchored in line with the Governing Council’s aim of maintaining inflation rates below but close to 2%, over the medium term.