The European Central Bank (ECB) recently said that interest rates are ‘appropriate’ and that inflation is expected to remain ‘moderate’, signaling it has no intention to tighten monetary policy any time soon.

The bank said in its monthly bulletin: ‘Current rates remain appropriate. The economy will grow at a moderate and uneven pace and price developments are expected to remain moderate over the policy-relevant horizon.’

In its latest quarterly survey of professional forecasters included in the monthly bulletin, the ECB said economists cut their forecasts for economic growth to 1.1% this year and 1.5% next year. That compares with a previous growth prediction of 1.2% this year and 1.6% in 2011.

The forecasters raised their prediction for 2010 inflation to 1.4% from 1.3% in February. The inflation forecasts for 2011 and over five years remained unchanged at 1.5% and 1.9% respectively