FRANKFURT, Dec 4: The European Central Bank, opting on Thursday to leave its key interest rates on hold for the remainder of the year, nevertheless raised a warning on the outlook for inflation, which it said depended in part on the evolution in public deficits in eurozone countries.

Convening for its last policy-setting meeting of this year, the ECB decided to leave eurozone borrowing costs where they were, at least until when it next met in January.

The ECB’s governing council announced the central “refi” refinancing rate would be held steady at 2.00 per cent.

And the bank also left its other two key rates — the deposit rate and the marginal lending rate — unchanged at 1.00 per cent and 3.00 per cent respectively.

Only 45 minutes earlier the Bank of England in London announced it was leaving its key rates unchanged, the ECB’s governing council decided to hold the bank’s central “refi” refinancing rate steady at 2.00pc.

ECB President Jean-Claude Trichet told a news conference afterwards that, for the time being at least, the current level of interest rates in the single currency area was “appropriate.”

—AFP