ECB holds interest rates at 1%

The European Central Bank today left its benchmark interest rate unchanged as it pushes eurozone governments to take stronger action to tackle their debt crisis.

The decision by the bank’s 23-member governing council left the refinancing rate at a record low of 1 per cent.

The bank had been under pressure to stimulate a weakening eurozone economy with a rate cut, but ECB president Mario Draghi has said the central bank cannot make up for inaction by governments.

Analysts said the bank is now likely to see what European leaders can come up with at a summit on 28 and 29 June.

This could include moves towards stronger oversight of banks, help for Spain and its troubled banks, or proposals for more growth or shared government borrowing.