Editorial: ECB rate hike sends clear message to spend with care
In a Europe gripped by crisis and uncertainty, governments must understand that the years of essentially free money are over
Interest rates can go up as well as down. This is a statement of the obvious and also of the unfamiliar. The European Central Bank’s benchmark interest rate has been at zero since 2016, first to ensure that the eurozone could navigate the aftermath of the global financial crisis and then to cope with the economic cost of the pandemic. Neither of those events was “normal”, so abnormal monetary policies were required to address them.