ECB raises interest rate to 4.25%

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Source: CCTV.com | 07-04-2008 09:46

European Central Bank has raised its benchmark interest rate by a quarter percentage point to 4.25 percent in an effort to rein in escalating inflation in the 15-nation euro zone.

Jean-Claude Trichet, President of the European Central  Bank ECB reacts during a news conference in Frankfurt,  central Germany, Thursday, July 3, 2008. The European  Central Bank raised its benchmark interest rate Thursday  by a quarter percentage point to 4.25 percent in an effort  to rein in escalating inflation in the 15-nation euro zone. (AP Photo/Daniel Roland)

Thursday's move comes despite worries that it could dampen growth. But the bank's President Jean-Claude Trichet says the fundamentals of Europe's economy are sound and focused on inflation which he says could remain high for longer than previously thought.

Trichet stressed his main objective is to keep prices stable. Inflation has been trying central banks around the world as commodity prices including oil and food have spiked with a surge of new global demand.

Editor:Du Xiaodan