This article is from the source 'bbc' and was first published or seen on . It will not be checked again for changes.
You can find the current article at its original source at http://news.bbc.co.uk/go/rss/-/1/hi/business/8083094.stm
The article has changed 5 times. There is an RSS feed of changes available.
Version 0 | Version 1 |
---|---|
ECB keeps eurozone rates on hold | ECB keeps eurozone rates on hold |
(30 minutes later) | |
The European Central Bank (ECB) has kept eurozone interest rates on hold at 1%, in a move that had been widely expected by analysts. | |
Unemployment in the eurozone hit a 10-year high in April, although there have also been some signs of improvement. | |
Analysts said the ECB was not keen to cut rates again for fear of sparking deflation after May's official eurozone inflation figure came in at 0.0%. | |
The Bank of England also kept UK rates on hold at 0.5% on Thursday. | The Bank of England also kept UK rates on hold at 0.5% on Thursday. |
Quantitative easing | Quantitative easing |
ECB president Jean-Claude Trichet said that the contraction of the eurozone economy would stabilise, with growth expected to return to the eurozone by "mid-2010". | |
He is expected to give more details of how plans first announced last month to buy 60bn euros of company bonds ($85bn; £52bn) were progressing. | |
The ECB is buying the bonds as a means to increase the amount of money in the financial system - a policy known as quantitative easing - to try to help the economy by returning lending by commercial banks to normal levels. | |
So far it has been far more cautious with its quantitative easing than the Bank of England and Federal Reserve, a decision that has been greatly welcomed by the German government. | So far it has been far more cautious with its quantitative easing than the Bank of England and Federal Reserve, a decision that has been greatly welcomed by the German government. |
Berlin has long cautioned against the more aggressive stance taken in London and Washington, saying it builds up too much debt for the future. | Berlin has long cautioned against the more aggressive stance taken in London and Washington, saying it builds up too much debt for the future. |
The ECB last cut rates in May, when they were reduced to 1% from 1.25%. It has reduced rates seven times since last October, when rates stood at 4.25%. | |