ECB holds interest rates at 4.25% as expected

FRANKFURT, Aug 7 (Reuters) – The European Central Bank left rates unchanged at a near 7-year high of 4.25 percent on Thursday, confirming financial market expectations that rates would not change so soon after July's quarter percentage-point rise.

ECB officials had given no hint that rates would be changed this month, and economists will listen closely to ECB President Jean-Claude Trichet's news conference at 1230 GMT for an updated economic outlook.

Euro zone inflation hit a record 4.1 percent in July, more than double the ECB's medium-term target, but bleak economic survey data has strengthened most economists' belief that growth stagnated from April to June and is little better now.

All 85 economists polled by Reuters last week expected the ECB to keep rates on hold.

The ECB also left its marginal lending rate at 5.25 percent and held its deposit rate at 3.25 percent.