European Central Bank holds its main interest rate at 0.75%

Thursday 08 November 2012 23.33
Analysts expected the ECB's decision to hold its main interest rate
Analysts expected the ECB's decision to hold its main interest rate

The European Central Bank expects the eurozone economy to remain poor, its President Mario Draghi said after the bank left interest rates unchanged.

"Economic activity in the euro area is expected to remain weak," Mr Draghi told a news conference after the ECB held its main interest rate at 0.75%.

He noted that recent economic surveys did not signal any improvement heading to the end of the year.

German business confidence fell last month to its lowest since 2010 and eurozone manufacturing shrank for the 15th month in a row.

Mr Draghi reiterated the ECB's view that inflation, which eased to an estimated 2.5% in October, would fall below 2% next year.

Gloomy data this week indicated the eurozone economy will shrink in the fourth quarter, which the ECB could eventually respond to by cutting rates.

Mr Draghi has signalled that the ECB would downgrade its GDP forecasts next month, describing "a picture of weaker economies".