ECB Keeps Key Interest Rate Unchanged at 1%

The European Central Bank (ECB) decided on Thursday to keep the key interest rate of the euro zone on hold at 1 percent, the Frankfurt-based bank announced.

"At today's meeting, the Governing Council of the ECB decided that the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 1.00 percent, 1.75 percent and 0.25 percent, respectively," the ECB announced on its website.

This is third month in a row the cental bank of the 16-country euro zone has kept the main policy rate at 1.0 percent.

Later in the day, ECB President Jean-Claude Trichet explained the decisions at a press conference, voicing his optimism at global economic prospects.

"While uncertainty is still high, there are increasing signs that the global recession is bottoming out," Trichet said.

For the euro zone, the ECB chief said the pace of contraction was "clearly slowing down," but economic activity over the rest of this year would "remain weak."

Looking ahead into next year, Trichet predicted that "after a phase of stabilization, a gradual recovery with positive quarterly growth rates is expected."