European banks react to subdued growth

March 8, 2012 at 1:16 PM

FRANKFURT, Germany, March 8 (UPI) -- The European Central Bank and the Bank of England left their lending rates at 1 percent and 0.5 percent, receptively, the banks said separately.

Decision makers at the BOE do not explain their decision until meeting minutes are released three weeks after a policy meeting.

At a news conference in Frankfurt, Germany, ECB President Mario Draghi said inflation would likely "stay above 2 percent in 2012" due to higher fuel prices "and indirect taxes."

"Nevertheless, we expect price developments to remain in line with price stability over the policy-relevant horizon," he said.

He said in his prepared statement economic expansion "remains subdued," avoiding the term "recession," which has shown up more frequently in economic predictions lately.

He pointed to the 0.3 percent contraction in the eurozone's economy in the fourth quarter of 2011, but then noted, "According to recent survey data, there are signs of a stabilization in economic activity, albeit still at a low level."

Related UPI Stories
Latest Headlines
Trending Stories
Vatican: Pope's meeting with Kim Davis not a show of support
Potential male contraceptive found in study with mice
Cancer and height are linked, new study shows
Hacker may have exposed data of 15 million T-Mobile customers
Education Secretary Arne Duncan to step down in December