The European Central Bank will keep interest rates at record lows for an extended period and could yet cut them further, the bank’s chief, Mario Draghi, said on Thursday.
Less than two hours hour after the Bank of England gave a steer about future interest rate moves at Mark Carney’s debut policy meeting as governor, the ECB president adopted the same tactic.
“The Governing Council expects the key ECB rates to remain at present or lower levels for an extended period of time,” Draghi told a news conference after the ECB left interest rates at 0.5 percent, emphasizing that this was the first time that the ECB had done so.
He added that the council had discussed cutting rates but decided against and said the bank could also consider cutting the deposit rate on bank deposits at the ECB – already at zero – in an attempt to foster more lending.
Central banks around the world are facing turbulent financial market conditions since the U.S. Federal Reserve last month set out a plan to exit from its money-printing program.