The European Central Bank (ECB) has decided to keep interest rates steady across the Eurozone. The main interest rate remains at 4.25%, and the deposit rate, the rate banks earn on parked funds, holds at 3.75%.
Despite the Eurozone's recession pressures, the ECB opted not to lower rates, largely due to the U.S. Federal Reserve's policy of maintaining higher rates despite a weakening job market. The ECB aims to prevent a widening rate gap between the Eurozone and the U.S., which could trigger capital flight.
To counter this, the ECB, in collaboration with partner central banks, will continue substantial purchases of U.S. Treasury bonds to prevent U.S. rates from rising too high and attracting capital away from Europe.