ECB leaves interest rate at record low

THE European Central Bank (ECB) held interest rates steady for the tenth month in a row yesterday, leaving the base rate at its 2% record low.

But markets remained unconvinced about prospects for another rate cut, which some analysts said could be on the way next month.

The decision to keep interest rates on hold will disappoint borrowers. But Goodbody economist Colin Hunt said Irish homeowners were already availing of rates that were 3% lower than would be the case if Ireland set its own interest rate. Mr Hunt said base rates in Ireland would be in the region of 5% if Ireland was outside the eurozone, a level which would have kept house prices "significantly lower" than their current levels.