FRANKFURT Feb 6 The European Central Bank left
interest rates unchanged on Thursday, holding off fresh policy
action to combat the threat of deflation while it waits for new
staff forecasts next month.
The decision to leave rates on hold was expected by most
economists as the bank awaits updated economic projections from
its staff next month. A downward revision to the inflation
outlook then could prompt a policy move.
The ECB held its main interest rates at 0.25 percent. It
also left unchanged the deposit rate it pays on bank deposits at
0.0 percent, and held its marginal lending facility - or
emergency borrowing rate - at 0.75 percent.
The central bank cut rates last November after euro zone
inflation tumbled to 0.7 percent in October. Inflation again
slowed to 0.7 percent in January, making next month's new
forecasts of crucial importance.
The ECB targets inflation of just below 2 percent and is
wary of it getting stuck in a "danger zone" below 1 percent.
Markets now turn their attention to ECB President Mario
Draghi's 1330 GMT news conference, at which he is expected to
repeat the bank's readiness to act in future.