The European Central Bank – ECB - announced yesterday a new increase in the reference interest rate by 25 basis points, setting it, for now, at 3.75%. It is the seventh increase since July 2022 and, according to the ECB itself, it will not stop here.
This ECB option, implemented in the name of fighting an inflation that was always far from being passing, is being made with the agreement of the Governor of the Bank of Portugal and the consent of the Portuguese Government. An option that scandalously favours financial capital - even if it carries with it risks for a financial system that is immersed in speculative activities - and which is translating into scandalous profits for the main banks, including those operating in Portugal, whose financial margin increased 9.5 times more than the average for European banks.
In contrast to the increase in banking profits, as well as that of other monopoly groups and multinationals, is the worsening of the living conditions of the workers and the people. This new increase in interest rates, following the previous ones, further worsens the situation of one million and one hundred thousand families who, in Portugal, have housing loans. The impacts on MSMEs and state funding are equally worrying. Simultaneously, the option of trying to curb inflation through the deterioration of purchasing power and investment - as intended by those who defend these increases - poses serious threats to the evolution of the economic situation of countries like Portugal.
For the PCP, the fight against the impacts of inflation requires, not measures that further worsen the living conditions of the workers and people, but an increase in wages and pensions, restoring the lost purchasing power, the regulation of the prices of essential goods and services and the fight against all forms of speculation, including a special taxation on the profits of economic groups and multinationals.
For the PCP, the increase in reference interest rates does not have to be reflected in the worsening of bank instalments for those who have housing loans. Instead of measures such as those decided by the PS Government, which in practice facilitate banking profits and harm the population, it is imperative that the banks' profits support the increase in interest rates.
For the PCP, this decision by the ECB is yet another that makes it clear who the monetary policy and the Euro serves, as well as the costs for the country of the loss of monetary sovereignty.
A policy with which PS, PSD, CDS, Chega and IL agree, and which has tied the country to economic stagnation, imposes the devaluation of wages and pensions, facilitates the degradation of public services, reduces public investment, hits national production, deepens the inequalities between peripheral countries of the Euro like Portugal and the great powers like Germany.