Europe’s central bank backs big rate hike despite bank chaos

By DAVID McHUGH
AP Business Writer

FRANKFURT, Germany (AP) — The European Central Bank has carried through with a large interest rate increase, brushing aside predictions it might dial back as U.S. bank collapses and troubles at Credit Suisse feed fears about the impact of higher rates on the global banking system. The ECB hiked rates by half a percentage point Thursday, underlining its determination to fight high inflation. In a statement, the bank called the banking sector in the 20 countries using the euro currency “resilient,” with strong finances. It says it’s “monitoring current market tensions closely and stands ready to respond as necessary to preserve price stability and financial stability in the euro area.”