July 2, 2009
ECB keeps interest rates unchanged
The European Central Bank left its key lending rate unchanged at 1 percent Thursday, a move anticipated by many economists.
In a prepared statement, bank President Jean-Claude Trichet said policymakers at the bank expected inflation to
remain dampened over the policy-relevant horizon. Policymakers also expected
a further deterioration in labor markets, he said.
An economic recovery was expected to be
gradual, he said, with a return to positive growth in the second quarter of 2010.
Trichet said stimulus spending could provide more of a boost than expected, but turmoil in the financial markets, rising commodity prices and
the intensification of protectionist measures would have a continued negative effects on the economy.