One of the representatives of the European Central Bank, Francois Villeroy de Galo, said that the ECB's decision to raise the interest rate by 50 basis points showed the priority of fighting inflation, as well as firm confidence in the reliability of European banks. In his speech, Villeroy, who is also the head of the Central Bank of France, noted that French and European banks are very reliable. This statement was made after a large-scale drop in banking stocks on world markets caused by the collapse of Silicon Valley Bank (SVB) in the United States last week. SVB's bankruptcy has also led to growing doubts about the future of Swiss bank Credit Suisse, leading investors to wonder if the ECB will suspend the rate hike cycle. Yesterday, the regulator raised the deposit rate to 3% – the highest level since the end of 2008, because, according to forecasts, inflation in Europe will exceed the target of 2% until 2025. Villeroy also noted that the ECB is unlikely to have to use its instruments to ensure the liquidity of banks, since European banks are not in the same situation as US banks.
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