ECB Maintains Key Interest Rates, El-Erian Says Nothing To Be Surprised About

The European Central Bank left key interest rates and other stimulus programs unchanged. The ECB decided the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 0.00 percent, 0.25 percent and -0.40 percent respectively.

"We continue to expect them to remain at present or lower levels for an extended period of time, and well past the horizon of our net asset purchases," Mario Draghi, President of the ECB said in a prepared remark posted in the ECB website.

However, Draghi said the ECB is ready to use "all instruments available," to ensure the inflation rate returns to its target of below, but close to, 2 percent. In March, the ECB said its forecast shows inflation was due to be only 0.1 percent this year, rising to 1.6 percent in 2018.

"The Governing Council will continue to monitor closely the evolution of the outlook for price stability and, if warranted to achieve its objective, will act by using all the instruments available within its mandate," Draghi said.

Following the ECB announcement, the European markets ended mixed. FTSE 100 was down 0.45 percent to 6,381.44, and the Cac 40 dipped 0.20 percent to 4,582.83. However, Dax 30 ended the day up 0.14 percent at 10,435.73.

The U.S market, however, was in the red.

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"The markets did not expect new measures out of the ECB and, indeed, the central bank did not announce any additional actions," Mohamed El-Erian, chief economic adviser at Allianz, told Benzinga in an email.

"To the extent that there was something slightly surprising, and it wasn't much at all, it would be a couple of very slightly less dovish remarks from ECB President Mario Draghi during his press conference, including an assertive statement that the central banks had not even discussed the policy option of "helicopter money,"" El-Erian added.

On the economic front, Draghi said the Euro area real GDP sequentially increased by 0.3 percent in the fourth quarter of 2015, supported by domestic demand, while being dampened by relatively weak export trends. Looking ahead, he expects the economic recovery to proceed.

However, Draghi noted that the risks to the euro area growth outlook still remain tilted to the downside.

"Our recent monetary policy decisions have improved overall financing conditions, which should support the outlook for consumption and investment. However, uncertainties persist and relate, in particular, to developments in the global economy and to geopolitical risks," Draghi added.

Last month, the Mario Draghi-led ECB stunned the market with three-pronged cut in interest rates and expansion of its bond-buying program.