European central bank keeps key rate at one percent

The European Central Bank on Thursday kept its key rate at one percent.

"On the basis of its regular economic and monetary analyses, the Governing Council decided to leave the key ECB interest rates unchanged, " Jean-Claude Trichet, president of the ECB, said at a news conference.

"The current rates remain appropriate," Trichet said. "The incoming information and analyses that have become available since our meeting in early October have confirmed our expectations."

The annual inflation rate was -0.1 percent in October, according to Eurostat's fresh estimate, and it was expected to rise above zero again in the coming months, Trichet said.

Medium to longer-term inflation expectations remain firmly anchored in line with the Governing Council's aim of keeping inflation rates below, but close to 2 percent over the medium term.

At the same time, the latest information continues to signal an improvement in economic activity in the second half of this year, Trichet said. The Governing Council expects the euro area economy in 2010 to recover at a gradual pace, recognizing that the outlook remains subject to high uncertainty.

The Governing Council also left interest rates on the marginal lending facility and the deposit facility unchanged at 1.75 percent and 0.25 percent respectively.

Source:Xinhua