Eurozone interest rates have been unchanged for more than a year

The decision to leave rates unchanged had been widely-expected.

Economists say the bank is in no rush to tighten monetary policy, despite short-term inflation.

They believe the ECB is reluctant to squeeze credit until it is sure high energy prices will not stall domestic demand and the economic recovery.

Eurozone interest rates have now been at 2% for more than a year.

Analysts will now look to the ECB's next interest rate decision and news conference on 2 September, when the bank will have new forecasts for eurozone growth and inflation.

However, most expect the bank to keep interest rates at current record low levels through into 2005.

"Economic growth remains weak and inflation appears moderate," said Ulrich Beckmann, an economist at Deutsche Bank in Frankfurt.