Eurozone rates remain at 1%

by Richard Kilner

Story link: Eurozone rates remain at 1%

The Governing Council of the European Central Bank (ECB) has chosen to keep the eurozone interest rate unchanged at its historically low level of 1%.

The decision comes as the Bank of England also elected to keep the United Kingdom’s record low rate of 0.5% unchanged, and to expand its quantitative easing asset purchase scheme by £25bn (the programme would otherwise have ended this month).

In Australia, less affected by the financial crisis than the eurozone or United Kingdom, the Reserve Bank has added 25 basis points to interest rates for the second month running, though there is little sign of the Bank of England doing likewise for the foreseeable future.

In Europe, France and Germany have both exited recession, with the UK performing below the widespread forecasts of a return to moderate growth in Q3, reducing the chances for any interest rate rises.