(ECB) The European Central bank will begin policy tightening with an increase in interest rates by a quarter percentage point in July.
ECB cited price pressures as the concern, with the governing council promising to return to its 2% inflation target over the medium term.
Despite earmarking a quarter percentage point hike, ECB said it may go for a larger increment if the medium-term inflation still looks hot.
ECB also said that it would end its 20-billion-euros bond-buying program on July 1, paving the way for the rate hikes.
The ECB also clarified bond shrinking and reinvestment of proceeds of maturing bonds. The Central Bank said that the reinvestments would continue for an extended time past when it starts to hike rates.
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