Danish Central Bank Raises Key Interest Rate to 2.1 Percent

Denmark's central bank is raising its key interest rate from midnight. The new key rate will be 2.1 percent. This decision follows a rate hike by the European Central Bank. Earlier today, the European Central Bank raised its rate to 2.50 percent. It had previously set the rate at 2.25 percent. This is only the second ECB rate increase in two years.

The European Central Bank raised rates to fight inflation in the euro zone. Higher inflation followed the recent conflict in the Middle East. Denmark maintains a fixed exchange rate policy for the Danish krone. The krone closely tracks the value of the euro. The European Central Bank manages the euro currency. Because of this policy, analysts expected Denmark's central bank to raise rates. Source: DR.