ECB president rules out further reduction in interest rates

European Central Bank president Mario Draghi has ruled out another reduction in interest rates.

There had been speculation that the ECB might drop their key interest rate below its current historically low value of 0.25%.

However, despite pressure for another cut in rates due to inflation in the Eurozone falling to a record low, Mr Draghi insists there are signs emerging of a dramatic improvement in the health of the European economy and played down fears of inflation.

While that means there is no need for a new cut in rates, there is good news for tracker mortgage holders as rates are also unlikely to rise for at least the next 18 months.

The last ECB rate cut came in November, with 375,000 tracker mortgage holders benefitting.