- Mario Draghi, the President of the ECB
The European Central Bank held its main interest rate at a record low of 0.75% yesterday. European Central Bank President Mario Draghi also mentioned that the region's economy will start gaining momentum and slowly recover this year, due to the stabilisation of the bond markets after three years of turmoil. Last month the ECB warned that the economy would even weaken in 2013, and the figures, released on Tuesday, showed that the unemployment rate in the Eurozone soared to a fresh high of 11.8%. The Eurozone economy contracted in the second and third quarters by 0.2% and 0.1%, respectively, and fell into a technical recession. Despite some positive signals from the ECB, the recovery remains fragile.
"We have signs that fragmentation is being gradually repaired," Draghi said at a press conference in Frankfurt today after policy makers kept their benchmark interest rate at 0.75 percent. "A gradual recovery should start" later this year as ECB measures work their way through the economy.
"The real economy continues to be weak," he said. Risks to the outlook are on the "downside" as the need for balance sheet adjustments and "persistent uncertainty" weigh on growth.
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