LONDON, May 10: Europe's main stock markets pulled back on Thursday in cautious trading before interest rate decisions from the European Central Bank and the Bank of England.

London investors were also on tenterhooks ahead of an official announcement from British Prime Minister Tony Blair, who was finally set to reveal his date of departure, bringing down the curtain on his decade-long tenure.

In late morning trade, the British capital's FTSE 100 index of leading shares dropped 0.20 per cent to 6,536.70 points.

Frankfurt's DAX 30 lost 0.26 per cent to 7,456.88 points and the Paris CAC 40 shed 0.17 per cent to 6,041.49.

The euro stood at 1.3536 dollars.

Meeting in Dublin on Thursday, the ECB was expected to hold eurozone borrowing costs at 3.75 per cent ahead of a likely quarter-point hike in June.

In London, the BoE was widely forecast to raise its rate by 0.25 basis points to 5.50 per cent, one day after the US Federal Reserve held American borrowing costs at 5.25 percent.

Investors track global interest rate decisions because higher borrowing costs increase companies' loan repayments, thereby biting into profits. They also lower consumers' disposable incomes.

In Wall Street trading on Wednesday, the Dow Jones index surged to a record finish after the Fed froze US rates as expected.

In London, shares in Anglo-Australian mining giant Rio Tinto plunged 3.01 per cent to 3,550 pence as speculation subsided about a potential takeover by rival BHP Billiton that had created a market frenzy on Wednesday.—AFP