ECB keeps rates at 1%

by Richard Kilner

Story link: ECB keeps rates at 1%

The European Central Bank’s (ECB) Governing Council has chosen to keep the eurozone’s interest rate steady at 1%.

The move echoes that of the Bank of England’s Monetary Policy Committee, which also selected to hold rates steady (at the historic low of 0.5%).

Despite the end to the global recession, with all major economies having returned to growth, the widespread monetary stimuli put in by central banks slashing rates to low levels, and in the case of the Bank of England embarking upon quantitative easing, few central banks have increased rates recently.

Earlier this month the Reserve Bank of Australia ended a run of 25 basis point increases, retaining the Australian interest rate at 3.75%.

However, the Bank of England did elect to pause in its quantitative easing programme, twice enlarged to £200bn.