The European Central Bank is adopting a 'wait and see' approach to the economy and will most likely keep its main refinancing rate at 1% until 2010 argue Bloomberg economists. ECB president Jean-Claude Trichet will consider the risks in future and has not given any indication as to whether interest rates will be reversed or cut further.

If the European Central Bank president decides to cut interest rates below 1%, this will appear bearish for the ECB and many lower currency exchange rates for the euro. On the other hand, if interest rates are to rise, the economic outlook will appear bullish. Either way, it appears as if the base rare will remain low until late 2010.

Euro currency exchange rates are currently at GBP1.1666 and USD0.7130.

The rates quoted above are interbank rates. Client rates may vary according to the volume and timing of the trade.