ECB keeps benchmark interest rate unchanged at record low

PanARMENIAN.Net - The European Central Bank has kept its benchmark interest rate unchanged at the record low of 0.05%, BBC News reports.

The bank began an asset purchase program last month, but has come under pressure to do more to boost weak economic growth in the eurozone.

On Tuesday, the European Commission cuts its growth forecast for the eurozone.

It now expects the eurozone to grow by just 0.8% this year, down from a previous estimate of 1.2%.

The commission also cut its growth forecast for 2015 to 1.1% from 1.7%.

ECB president Mario Draghi will hold a press conference later. His comments will come under scrutiny for any hints of future action by the bank.

In September, the bank's head Mario Draghi announced an asset buying program, although not a quantitative easing (QE) programme, which involves buying government debt - something that is hugely controversial within the eurozone and fiercely opposed by powerful Germany.

Its attempt to kick some life into the sluggish eurozone economy is to buy covered bonds and other assets for two years.

Covered bonds are those backed by public sector loans or mortgages.

Many economists do not think this will be enough to promote economic recovery and the pressure on Draghi to come up with further measures.

Next month the ECB will give its latest forecasts for the eurozone area. Its most recent, given in September, forecast growth of 0.9 percent this year and 1.6 percent in 2015.