(Reuters) – European shares rose on Thursday after the European Central Bank raised interest rates for a tenth straight time, lifting borrowing costs to a record high while also signalling an end to their monetary policy tightening cycle.

The central bank raised rates by 25 basis points, taking the rate the ECB pays on bank deposits to 4%, the highest level since the euro was launched in 1999.

“Based on its current assessment, the Governing Council considers that the key ECB interest rates have reached levels that, maintained for a sufficiently long duration, will make a substantial contribution to the timely return of inflation to the target,” the ECB said.

The pan-European STOXX 600 climbed 0.6% by 1235 GMT, supported by banks and commodity-linked stocks. Rate-sensitive banking stocks gained 1.2%.

“Markets are basically rejoicing that this is the end of the cycle and that’s why even this 25 basis points rate hike is being met by a strong rally,” said Pooja Kumra, Senior European and UK rates strategist, TD Securities.