Calls for emergency debate as ECB increase interest rates

The European Parliament has been urged to hold an emergency debate on the European Central Bank’s decision to hike interest rates by a quarter of a percentage point, amid MEP warnings the decision risks “widening the gap between the rich and the poor”.

Portuguese MEP and Left Group member Joao Oliveira issued the call after the ECB last week increased interest rates from 2.25% to 2.5%.

Speaking to RTE News last week, the ECB’s chief economist and former Central Bank of Ireland Governor Philip Lane said the decision is in part because eurozone inflation currently stands at 3.3% compared to the ECB’s 2% target – a situation he argued is a “measured adjustment”.

However, responding to the view at the European Parliament, Mr Oliveira said ordinary people cannot continue to pay the price for national and global policy decisions by those in power.

“The ECB has decided to maintain or even raise interest rates, which has serious impacts. The real root causes of inflation are not being dealt with, and there is a real impact on workers and SMEs.

“Costs will go up, and it aids banks,” he said.

Mr Oliveira continued that there is an ongoing need to “stabilise the Middle East” and address the Strait of Hormuz stand-off as the situation is “affecting people”.

He added that normal households “cannot afford fuel, and house prices are going up”.

Calling for an EU-wide debate on the real impact of ECB inflation rises on the public, he said in his view the situation is “widening the gap between the rich and the poor”.