ECB holds back from raising rates

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The Independent Online

There is no need for higher interest rates despite the likelihood of inflation remaining above target for most of this year, Jean-Claude Trichet, President of the European Cental Bank, signalled last night as the bank kept rates unchanged at 1 per cent.

The assessment follows a slight rise in eurozone inflation to 2.4 per cent last month, higher than than the bank's target of just below 2 per cent.

"This has not so far affected our assessment that price developments will remain in line with price stability over the policy relevant horizon," Mr Trichet said, leading analysts to conclude that the ECB saw no need for a hike in interest rates anytime soon.