ECB keeps interest rate steady at 0.25 percent for fifth straight month

Nathan Andrada – Fourth Estate Cooperative Contributor

Frankfurt, Germany (4E) – The European Central Bank (ECB) did not take any action on Thursday as it kept its key interest rates unchanged for the fifth consecutive month.

In a statement, the bank held its central refinancing rate at 0.25 percent during its monthly policy meeting.

The ECB also maintained its marginal lending rate at 0.75 percent and the deposit rate at zero percent. The last time the bank pared back borrowing costs in the euro area was back in November.

While some analysts had been expecting a further cut in April, some still expect the central bank to ease monetary conditions in the common currency bloc at some point to avoid risks of deflation.

For now, ECB officials are not too worried that the euro area is in danger of falling into deflation, where prices spiral down resulting to delay in consumer purchases, thus hurting jobs, salaries and investment.

The euro zone statistics agency Eurostat estimates the bloc’s inflation at 0.5 percent in March, lower than 0.8 percent in February and way below the ECB’s 2.0 percent target.

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