ECB leaves door open for 2013 cut

The ECB pondered an interest rate cut yesterday and predicted the eurozone economy would shrink again in 2013, leaving the door open to a possible reduction in borrowing costs early next year.

ECB president Mario Draghi said the policymaking governing council held a wide discussion on interest rates before opting to leave them on hold. The euro fell against the dollar and the yen in response.

The council also touched on the idea of cutting its deposit rate into negative territory. By effectively charging banks for deposits rather than paying them interest, the ECB could push banks to put their money to work elsewhere.