The European Central Bank (ECB) raised the main refinancing rate by 50 basis points to 3.00% as expected, while pledging to bring rates further in March.
The first move of 2023 in January came after four hikes in 2022 that brought eurozone interest rates out of negative territory for the first time since 2014 to fight soaring inflation.
Meanwhile, deposit facility rate and marginal lending facility rate were both raised on Thursday by 50bps to 2.50% and 3.25%, respectively.
Preliminary data released on Wednesday showed that inflation in the Eurozone dropped to 8.5% in January due to sustained decline in energy prices. In December, the inflation rate stood at 9.2%.
The central bank said that it intends to raise rates by another 50 basis points in March and then will evaluate the situation for its next move.