There have been calls for lower rates

The European Central Bank made the announcement at a governing council meeting on Thursday.

Some political leaders such as German Chancellor Gerhard Schroeder had called for a rate reduction to cool the high flying euro against the dollar.

However, the dollar rallied this week, dropping the euro to a three-month low.

Expectations of good news about American jobs from the US Labor Department on Friday are also helping to boost the dollar.

Cut unlikely

The ECB, which is forbidden by its founding treaty from taking instructions from national governments, has paid scant attention to politicians since its launch in 1998.

Economists have said that their advise could even backfire by making bank officials become entrenched in their positions to protect their reputation for independence.

Rates are appropriate for the current situation Nicholas Garganas

All eyes are now on ECB President Jean-Claude Trichet's comments, to watch for signs of movement to come.

Mr Trichet has expressed concern about sharp swings in exchange rates, but has not indicated the bank is considering a rate cut.

Bank officials have said that rates are already low enough to stimulate growth.

The economy is also thought to be improving which will make interest rate rises, not cuts, necessary.