“IMF Urges European Central Banks to Raise Interest Rates to Combat Inflation”

The International Monetary Fund (IMF) on Friday called on European central banks to “kill the inflation beast” by raising interest rates.

“You have to kill this beast,” Alfred Kammer, head of the IMF’s European division, told reporters in Stockholm.

He noted that history has many examples of policymakers stopping interest rate hikes, but then being forced to try again to reduce inflation, further damaging the economy.

The European Central Bank, along with other central banks in the region, have followed the US Federal Reserve since last year and significantly increased interest rates to combat high inflation.

But with economic growth slowing and inflation falling, as well as several bank failures due to high interest rates, there is growing speculation that central banks could hold off on raising interest rates.

The IMF believes that central banks should continue to raise interest rates, and the banking system, especially in Europe, will be able to withstand the burden of high interest rates.