European Central Bank

The outlook for the Italian economy is improving but higher interest rates designed to curb inflation could pose a threat to growth, Italy's economy minister said on April 1, sending a warning to the European Central Bank (ECB).

"Fighting inflation with monetary policy is not enough, recession cannot be the price paid for fighting inflation," Giancarlo Giorgetti said.

Inflation in the eurozone slowed more sharply than expected in March but food prices jumped even as energy costs eased, official data showed on March 31.

Consumer prices rose by 6.9 percent on an annual basis, down from 8.5 percent in February, according to the European Union's statistics agency.

Inflation in the 20 countries that use the euro currency slowed to the lowest level in a year as energy prices dropped, but food costs were still on the rise, keeping pressure on the European Central Bank to hike interest rates further.

The governor of the Central Bank of Cyprus (CBC), Constantinos Herodotou, said on Wednesday there is concern in the markets that problems with some European banks could evolve into something bigger. He added however that the European Central Bank (ECB) was reassuring about the health of the European banking system.

Amid the fallout from the Ukraine conflict and recent financial turmoil, Greece arrived at Thursday's regular European Council meeting in Brussels hoping to have a discussion on the new framework for fiscal policy conduct at the level of heads of state.

Maybe it was not necessary for the Silicon Valley Bank and Credit Suisse debacles to come along for the winds of uncertainty to blow in the global economy.

They had already been stirred by the war in Ukraine, the energy crisis, and a rise in inflation in the eurozone.

The exposure of Greek banks to Credit Suisse is "almost zero," Greek central bank chief Yannis Stournaras told Reuters on Monday.

"They (the Greek banks) are not exposed to Credit Suisse's Additional Tier 1," Stournaras, who also sits on the ECB's 26-member Governing Council, said, adding that Greek banks are solid. [Reuters]

The banking crisis that hit Silicon Valley Bank (SVB) last week has spread. We recall with a shudder two recent financial contagions: the 1997 Asian Financial Crisis, which led to a deep Asian recession, and the 2008 Great Recession, which led to a global downturn.

No one can claim they got bored watching Thursday's bourse session at Athinon Avenue, as after the 4.55% slump on Wednesday, the fastest in nine months, buyers returned in force on Thursday morning boosted by the central bank's support for Credit Suisse.

The European Central Bank today raised the key interest rate by 50 basis points to 3.5%, the highest level since 2008, and did not comment on what its future steps might be to control inflation.