Brussels, 03/12/2009 (Agence Europe) - At its meeting on Thursday 3 December, the European Central Bank (ECB) decided not to change the key eurozone exchange. The main refinancing rate remains at 1% and the marginal lending facility and the deposit facility rate remain at 1.75% and 0.25% respectively. Speaking after the meeting of the bank's Governing Council, the President of the ECB, Jean-Claude Trichet, told reporters that the current interest rates were appropriate and inflation had to be kept down. He said that the interest rate decision had been unanimous, as had the decision for the ECB to gradually withdraw its special measures introduced to stimulate the economy.
After five quarters of contraction, real GDP growth in the eurozone returned to the black in the third quarter of 2009 (to 0.4%) and the information available suggests that the recovery will continue in Q409. Trichet said that the return to growth was supported by temporary factors and recovery would probably be uneven. The ECB projections suggest that growth will be negative in 2009, at between -4,1% and -3,9%, followed by growth of between 0.1% and 1.5% in 2010 and between 0.2% and 2.2% in 2011, he added, confirming that the range of growth predictions for 2010 was now higher than the September 2009 forecasts.
Inflation has also returned to above zero after five months of contraction, reaching 0.6% in November 2009 (compared with -0.1% in October 2009) and prices are expected to continue to rise in the short-term. In the longer term, inflation is expected to be moderate and well within the ECB's price stability objectives (just under 2%). As far as the ECB is concerned, inflation is forecast to reach 0.3% in 2009, between 0.9% and 1.7% in 2010 and between 0.8% and 2% in 2011 (well on target).
The Governing Council has decided on the first withdrawals of measures introduced to deal with the worst of the credit crunch. Trichet said: “The improved conditions in financial markets have indicated that not all our liquidity measures are needed to the same extent as in the past”, adding that the end of the refinancing operations would be one year after the most recent 10 December 2009 call for tender, which will be at an indexed rate (the minimum average rate for major refinancing operations over the lifetime of the operation), explained Trichet, warning that this should not be interpreted as a hint about future interest rates. He said that the six months refinancing operation scheduled for 31 March 2010 would be the last of its type (using a full fixed rate call for tender). (A.B./transl.fl)