ECB holds rates as inflation eclipses growth risks

The European Central Bank held its main interest rate at a record low of 0.75% on Thursday, holding fire after a pick-up in inflation last month offset pressure to breathe life into the flagging euro zone economy by easing borrowing costs.

Annual euro zone inflation accelerated to 2.6% in August from 2.4% in July, coming in stronger than expected and further above the ECB's target of just below 2%.

The ECB also left the interest rate on its deposit facility at 0.0% - a low it went to for the first time in July to encourage banks to lend overnight to other banks, where they receive a higher rate, currently about 0.1%.

The ECB held its marginal lending facility - or emergency borrowing rate - at 1.50%.