The European Central Bank is expected to hold interest rates steady today on hopes the low-flying euro zone economy may at last be gaining some lift from a global recovery.
The latest economic data showed manufacturing orders and output rising at their fastest pace since 2000, with business confidence also brightening. The hope is consumers will follow.
But doubts remain. The euro zone service sector barely improved in April, signalling domestic demand is still running too slowly to power a broader economic take-off.
Despite this slow growth, senior euro zone officials said the ECB Governing Council, which began its rate meeting this morning, is loath to cut interest rates beyond the already historic low of 2 per cent reached 11 months ago.
The ECB Governing Council, gathering in Finland for one of the two meetings it holds every year outside Frankfurt, is due to announce its rate decision this morning, and a news conference with ECB President Jean-Claude Trichet, giving details of the central bank's outlook, follows later.