September 3, 2009

ECB leaves lending rates unchanged

The European Central Bank left its overnight bank-to-bank lending rate unchanged Thursday citing an uneven economic recovery.

In a news conference, bank President Jean-Claude Trichet said inflation in the euro at minus 0.2 percent in August, was expected to turn positive within the coming months. The EC bank said it would keep the lending rate at 1 percent, the rate it first set in May.

Trichet said it was not yet time to back away from economic programs that propped up the financial system for the past 12 months. An economic recovery was expected to be rather uneven he said.

Trichet said economic progress lags behind monetary policy changes, The New York Times reported.

Hence with all the measures taken, monetary policy is providing support for households and corporations, he said.