The European Central Bank will keep interest rates at record lows for an extended period and could yet cut them further, the bank’s chief, Mario Draghi, said yesterday.

Fewer than two hours hour after the Bank of England gave a steer about future interest rate moves at Mark Carney’s debut policy meeting as governor, the ECB president adopted the same tactic.

“The Governing Council expects the key ECB rates to remain at present or lower levels for an extended period of time,” Draghi told a news conference after the ECB left interest rates at 0.5 per cent, emphasising that this was the first time that the ECB had done so.

He added that the council had discussed cutting rates but decided against and said the bank could also consider cutting the deposit rate at the ECB – already at zero – in an attempt to foster more lending.

Central banks around the world are facing turbulent financial market conditions since the US Federal Reserve last month set out a plan to exit from its money-printing programme.

Whether forward guidance about policy can mitigate the impact of the Fed’s move on other countries remains to be seen.

The ECB left its main refinancing rate at 0.5 per cent and the deposit rate at zero, as was expected by economists in a Reuters poll.

“50 basis points is not the lower bound,” Draghi said.

His intervention represented a marked departure from the bank’s June meeting when he doused expectations of any imminent policy action and also from the ECB’s customary insistence that it never precommits on interest rate policy.

During his speech Draghi said it was a coincidence that the two central banks had gone down a similar path. (Reuters)