A full-scale review of European Central Bank policies promised by new president Christine Lagarde is set to get underway, the ECB said Thursday. File photo by Erik S. Lesser/EPA-EFE
Jan. 23 (UPI) -- The European Central Bank said Thursday it will maintain its historically low interest rate structure, including its main deposit rate of -0.5 percent, until it sees higher inflation levels.
Citing persistently low inflation it sees as damaging to the Eurozone economy, the ECB also retained its current marginal lending facility rate of 0.25 percent and the main refinancing operations rate of 0 percent.
The central bank's governing council said it expected the key interest rates "to remain at their present or lower levels until it has seen the inflation outlook robustly converge to a level sufficiently close to, but below, 2 percent."
The ECB estimates that consumer prices need to rise by just below 2 percent annually to foster healthy economic growth. Inflation spiked to a six-month high of 1.3 percent in December, up from 1 percent in November.
That movement has prompted renewed calls from pensioners, lenders and other for the ECB to change its policies on low interest rates, which they contend are contributing to Europe's sluggish economic growth.
The low rates were long championed by former ECB President Mario Draghi, whose eight-year term ended in October. His successor, Christine Lagarde, promised last month to institute a full-scale review examining ECB policies -- its first since 2003 -- and Thursday's ECB announcement indicated the review had been officially launched.
The details were to be announced later in the day during a press conference to be held by Lagarde.
Much like the ECB, the U.S. Federal Reserve Bank is expected to leave interest rates unchanged when it holds its first policymaking meeting of 2020 on Jan. 29-30.