Here's the report from the Associated Press, via Forbes.com:
The European Central Bank left its key interest rate unchanged at 2 percent Thursday as it waits for signals that the continent's hesitant recovery has built up more strength.
The decision by the bank's 18-member governing council, meeting in Frankfurt, was widely expected by economists. The key refinancing rate, which sets the cost of central bank credit to commercial banks, has stood unaltered since June 2003.
No surprises from the Bank of England, either.
The move was mirrored by the Bank of England, which kept its key rate unchanged at 4.75 percent. Britain has not adopted the euro currency and therefore has its own interest rate policy.
As usual, the President (of the ECB) offered some explanation.
At a post-decision news conference, ECB President Jean-Claude Trichet reiterated his view that Europe's moderate recovery is continuing on the back of a growing world economy...
Trichet said the worst inflationary effects of high oil prices appear to have eased as prices have fallen, and said that inflationary pressures in the short term accordingly "have diminished somewhat."
Therefore, while rates are at the right level now, Trichet said, "we have to continue to be vigilant. And we will be vigilant."
The expectation of moderating inflation is important in the context of the ECB's inflation targets.
...euro-zone inflation ran at 2.3 percent in December, above the bank's guideline of below but close to 2 percent. The bank expects inflation to fall this year, however, and it's the forecast - rather than past data - that weigh more heavily since rate moves take months to have an effect.
That said, the belief that the ECB would hold steady on the policy rate was probably driven as much by this assessment of the real side of the Eurosystem economic outlook, as it was by any conviction that inflation is heading south:
Despite Trichet's outlook, there have been enough worrying signs about growth in the 12 countries that use the euro for the bank to put off its next expected move, a rate increase to ward off inflation as the recovery picks up.
Growth in the euro countries slowed to 0.3 percent in the third quarter from 0.5 percent in the previous three months, while more recent data also raises worries. Manufacturing orders in Germany, Europe's biggest economy, dipped in November, and unemployment there rose to 10.8 percent in December.