The European Central Bank held its key interest rates steady on Thursday, but analysts believe it could pave the way for new stimulus measures soon, despite growing resistance in Germany.
The ECB’s governing council voted, as expected, to keep the benchmark “refi” refinancing rate at its current all-time low of zero percent, after cutting it to that level in March, an ECB spokesman said.
At the same time, the ECB also held the rate on its marginal lending facility unchanged at 0.25 percent and the rate on the deposit facility steady at minus 0.40 percent.
At its previous meeting on March 10, the ECB had announced a new range of new policy moves aimed at pushing chronically weak inflation in the euro area back up to economically healthier levels.
These included cutting interest rates, beefing up its controversial asset purchase programme known as quantitative easing and making vast amounts of cheap loans available to banks.
And analysts said the central bank would be watching closely how the effects of those moves were mapping out in the eurozone economy.
ECB president Mario Draghi was scheduled to comment on the reasoning behind the latest monetary policy decisions at a news conference later.
Analysts said they expected him to stress that further action could still be on the cards further on down the line, even in the face of increasing criticism of ECB policies in Germany.
“Germany is the ECB’s main problem at the moment,” a source close to the central bank said.
German Finance Minister Wolfgang Schaeuble has been unusually frank about his displeasure over zero interest rates, suggesting they were helping foment political unrest in Germany and aiding the rise of an anti-euro, anti-immigrant party, the AfD.