ECB keeps rates at 1%

by Richard Kilner

Story link: ECB keeps rates at 1%

The Governing Council of the European Central Bank (ECB) has announced that it is keeping interest rates unchanged at 1%.

The move was widely expected, and means that the eurozone, which has been beset by troubles in recent months, retains its lowest ever interest rate.

The decision comes as the Bank of England also elected to keep the British interest rate unchanged at the historic low of 0.5%, pending the emergency Budget to be delivered on 22 June.

The single currency has been hitting the headlines for all the wrong reasons recently, with the most spectacular example being Greece.

The Greek economy is in very choppy waters, a situation exacerbated by the inability to devalue the currency (formerly the drachma) due to the monetary union with numerous other, highly diverse, European economies.

Other countries in the eurozone also face varying degrees of difficulty, including Portugal and Spain.