ECB makes first rate hike since 2023 to tame Iran war inflation

The European Central Bank (ECB) raised its benchmark interest rate on Thursday for the first time since 2023 as the Middle East war stokes inflation, rejecting criticism that the move could hit growth in the struggling eurozone.

The ECB lifted its deposit rate a quarter point to 2.25 percent, becoming the first major central bank to tighten monetary policy in response to the energy shock unleashed by the conflict. President Christine Lagarde cited the "inflation pressures" generated by the conflict, as the ECB delivered its first rate hike since 2023.