frankfurtthe european central bank said it would aim to phase out its large bondbuying program by september taking a key step toward raising interest rates to contain surging inflation despite the shock of war in ukraine the ecb said in a statement that it would keep its key interest rates on hold but signaled that it wouldnt reduce them further any ecb interestrate hikes will take place some time after the end of the banks bondbuying program and will be gradual the ecb said taken together thursdays actions signal a determined move away from the ultra easy monetary policies that the ecb introduced in recent years they reflect mounting concerns about inflation which is close to 6 in the eurozone and could rise further major central banks including the federal reserve have signaled that they want to start raising ultralow interest rates to keep a lid on inflation that has touched multidecade highs on both sides of the atlantic the war has complicated those calculations especially in the eurozone which borders on both russia and ukraine the blocs deep trade relations with russia include sizable exports and a heavy reliance on russian oilandgas supplies crucial for the regions large industrial sector however the ecbs actions suggest it is focused on inflation which is likely to rise higher as energy prices soar investors will now turn to ecb president christine lagardes news conference starting at 830 am et for clues as to how else the bank might respond to the ukraine conflict and when policy makers plan to start lifting interest rates the decision to end the ecbs bondbuying program would draw a line under a key stimulus tool that has been in place for much of the past seven years the ecb said purchases under the program would amount to 40 billion euros 439 billion in april eur30 billion in may and eur20 billion in june the purchases will end in the third quarter provided that incoming data support the expectation that the mediumterm inflation outlook will not weaken the statement said the ukraine conflict is a stagflationary shock for europe it heightens the risks of a new recession by curbing european exports straining supply chains and driving up energy and commodity prices for households and the regions large manufacturing sector it is also likely in the short term to push up eurozone inflation which at 58 in february is already almost three times the ecbs 2 target european stock markets have declined far more than their us counterparts over the past month and the euro has fallen against the dollar adding to the inflationary pressures in the us fed chairman jerome powell told congressional officials last week that he would propose a quarterpercentagepoint interestrate increase at next weeks meeting effectively ending speculation over a larger halfpercentagepoint increase ms lagarde had signaled in february before the ukraine war began that the ecb might start to increase interest rates later this year even before the conflict europes economic recovery had less momentum than that of the us partly because of lower government spending new ecb staff economic forecasts published on thursday are likely to show lower economic growth and higher inflation european union leaders could unveil fresh government spending plans when they gather thursday and friday at versailles outside paris to discuss their response to russias aggression against ukraine