The European Central Bank has retained its main interest rate intact at one percent for the twentieth consecutive month with the euro zone debt crisis boiling.

The decision taken by ECB on Thursday to keep its refinancing rate where it has stood since May 2009 was well expected in spite of the annual inflation in the 17-nation euro zone rising to 2.3 percent in December, surpassing its target.

Attention at bank President Jean-Claude Trichet's post-decision news conference will mainly be on the ECB's bond-buying program, meant to support the debt of financially troubled governments.

The bank along with the European Union and the 17 governments that share the currency, euro, are struggling to address a crisis caused by too much state debt in some countries.

The euro gained versus the dollar on Thursday, getting support as European Central Bank chief Jean-Claude Trichet asked policy makers to be ready to act for countering a recent rise in inflation.

The dollar declined for a fourth trading session, burdened by a hike in U. S. jobless claims.

The euro was seen trading at $1.3358, up sharply from $1.3129 seen in late North American trading Wednesday.

The euro got its support as Trichet, speaking during his monthly news conference, expressed his views on a recent increase in consumer inflation.

Treasury Secretary, Timothy Geithner, prior to the President Hu Jintao's state visit to Washington next week, stated that Beijing must bring in certain reforms before there can be more economic cooperation between China and the U. S.

He further said that inflationary expectations remain strongly anchored and the bank remains on alert to the need for price stability and further emphasized that policy makers should never make any prior commitment to rate decisions before policy meetings.