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ECB says interest rates to stay low for 'extended period'

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ECB says interest rates to stay low for 'extended period'
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There was no interest rate change from the European Central Bank at the policymakers’ July meeting. It stayed at a record low 0.5 percent.

And ECB President Mario Draghi hinted that would be the case until well into next year at the earliest.

The only move might be down, Draghi said, though he confirmed a cut in the cost of borrowing was not discussed at the meeting, even though the eurozone economic recovery remains fragile.

He told a news conference: “Euro area economic activity should stabilise and recover at a slow pace. The risks surrounding the economic outlook for the euro area continue to be on the downside.”

The European Central Bank is under pressure to support an economy struggling to escape from the longest recession in the eurozone’s existence.

Its wait and see approach came as we learned that eurozone manufacturing activity grew for the first time in two years in July.

It was the latest promising economic data out of the bloc.

Unemployment in the region fell for the first time in more than two years in June, while economic confidence among executives and consumers in the region improved in July to a 15-month high,

Consumer spending in Germany, France and Spain was disappointing in June, but overall the economic data point to a muted recovery.