European Central Bank raises interest rates by half-point, twice that of US Fed hike

The European Central Bank on Thursday raised key interest rates by 50 basis points, or a 0.5% hike, one day after the U.S. Federal Reserve raised interest rates by 25 basis points, or 0.25%, as both financial institutions attempt to fight high inflation.

The European bank, which oversees the 20 countries that use the euro, raised its lending rate to 3% and its rate for deposits to 2.5%.

The Fed's federal funds rate is 4.5% to 4.75% after Wednesday's announcement.

Both financial bodies have the goal of lowering inflation to 2%. The United States saw rates as high as 9.1% in June, while some areas of the European Union saw inflation rates as high as 23.1% last year.