Eurozone interest rates were hiked to a record high of 4% by the European Central Bank, as it warned inflation was "expected to remain too high for too long".
But has the ECB moved too far too fast?
Economist Simon Barry said the ECB was among the last of the major central banks to start and it has done less than both the Fed and the Bank of England, both of whom started before the ECB, both of whom have raised rates by more than 5%.
"There was genuine uncertainty around yesterday's outcome," Mr Barry said. "Ultimately they came to the view that unless they acted, inflation would be too high for too long."
The ECB appears to be in wait and see mode now. It was part of the messaging that accompanied yesterday's decision that the governing council think that if rates are left at their current level for long enough that it gives them a degree of confidence that there will be significant progress towards their target.
"It does look like they've entered a wait and see mode. They're still standing by to potentially go again, but I think the most likely outcome now is that they are probably in wait and see mode," the economist told Morning Ireland.
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Is achieving the 2% inflation target warranted in the current circumstances? It is a question that the ECB keeps under review.
"We know two years ago that they undertook a major overhaul of its strategy, a full deep dive into what they're doing, why they're doing it and how they're doing it. The conclusion was that they did make some changes to their target. Previously the target was close to but below 2%, they've straightened that up, it's now a straight 2% target.
"They are going to revisit this, but not until 2025. They may come back to it, but for the foreseeable future it's not something that's going to change," Mr Barry said.
Talk of when the rate might start to come down seems premature, especially given that ECB President Christne Lagarde said they are not engaging with the topic, and they don't even pronounce the word 'cut'.
However, Mr Barry thinks it is fair to think that if they are now probably at their peak, it's reasonable to think when they might start to go in the opposite direction. "Markets are thinking that that might happen perhaps around the third quarter of next year. That seems like a reasonable guess from what we currently know."
