Bank of England raises rates; ECB stands pat

The European Central Bank left interest rates unchanged today, after raising them seven times in the past year and a half, according to Bloomberg News.
At their meeting in Dublin, policymakers kept the refinancing rate at 3.75 percent, as predicted by all 45 economists surveyed by Bloomberg before the vote. But ECB President Jean-Claude Trichet called for “stricter vigilance” going forward, which analysts saw as indicating a rate hike at next month’s meeting.
“He delivered ‘strong vigilance’ as expected,” Thomas Herrmann, an economist at Credit Suisse Group in Zurich, told Bloomberg. “The June rate increase is a certainty,” Herrmann said, and the ECB is likely to continue raising rates thereafter.
The Bank of England today raised its benchmark rate by a quarter point, to a six-year high of 5.5 percent, Bloomberg noted. Recent reports have shown manufacturing in Europe expanded in April for the 22nd consecutive month, consumer confidence is near a six-year high and unemployment in March fell to 7.2 percent, the lowest since at least 1993.
The U.S. Federal Open Market Committee yesterday voted to leave its benchmark federal funds rate unchanged at 5.25 percent, as it has at every meeting since August. READ MORE