European Central Bank keeps policy unchanged, to take aim at strong euro

The European Central Bank left policy unchanged on Thursday but with the economic recovery losing momentum and a strong euro dampening inflation expectations, ECB President Christine Lagarde is expected to set the stage for more stimulus later.

Having pulled out the stops this spring to halt a historic economic decline across the 19-country currency bloc, the ECB has time to let governments implement their own countermeasures and for its own ultra-easy policy to seep into the real economy. But hurdles to the rebound from a 12 per cent output drop in the second quarter are proving bigger than expected, and economists