The Governing Council of the ECB cautioned in a statement that inflation prospects remain excessively high for a prolonged period, while also acknowledging that there are uncertainties in the underlying price pressures.

“The Governing Council will continue to follow a data-dependent approach to determining the appropriate level and duration of restriction. In particular, the Governing Council’s policy rate decisions will continue to be based on its assessment of the inflation outlook in light of the incoming economic and financial data, the dynamics of underlying inflation, and the strength of monetary policy transmission,” the ECB said.

ECB president Christine Lagarde said that there was almost unanimous support for the smaller interest rate increase and suggested that this may not be the final increase in the current policy tightening campaign.

While core prices, which exclude energy and food, edged lower to 5.6% in April, headline inflation increased for the first time in six months to 7%. The ECB has made controlling price growth a top priority. (ILKHA)