The European Central Bank has decided to keep euro interest rates on hold at 4.0% for the eighth consecutive month.

The ECB said it is concerned with high inflation in the eurozone at a time when growth and confidence in the economy appear to be falling. In January inflation in the eurozone stood at a record 3.2%.

ECB President Jean-Claude Trichet said, “uncertainty about prospects for economic growth is unusually high.” However, he asserted that, “the fundamentals of the euro area economy remain sound”.

Despite keeping rates on hold, the central bank is expected to lower interest rates in the 15-nation eurozone later this year as growth is expected to slow further.