The ECB governing council, in Vienna, Oct, 2009. Prof. Patrick Honohan, front row, second from left, was attending his first meeting following his appointment as governor of the Irish Central Bank.

European Central Bank President Jean-Claude Trichet today signaled that the ECB will wait for stronger signs of economic recovery before accelerating the withdrawal of emergency measures.

“The current rates remain appropriate,”Trichet said at a press conference in Frankfurt, after the governing council kept the benchmark interest rate at 1%. He said that Greece can’t expect any special treatment from the EMU and will have to help itself.

On the vulnerability of the common currency area, he said Greece accounted for about 2.5% of Eurozone GDP and he said for a large population currency union, economic diversity is no different than in the United States. 

Europe’s recovery as it risk of stalling as governments wind down stimulus measures such as job supports and car scrappage schemes.

The governing council will “continue to implement the gradual phasing out of the extraordinary liquidity measures which are not needed to the same extent as in the past,” Trichet said. The ECB will take further decisions on its liquidity operations in March, he said.

The ECB president said the Eurozone is threatened by “low” factory usage and the “ongoing process of balance sheet adjustment,” which will counter the benefits of improving exports. At the same time, risks to the economy are still “broadly balanced,” he said.

The ECB forecast last month that the region will expand 0.8% in 2010.

Introductory statement

Obama bank levy

Bloomberg reports that as many as 50 financial firms with assets greater than $50 billion each would be charged a levy President Barack Obama will announce today to help recoup taxpayer-bailout money and trim the federal budget deficit.

“My commitment is to recover every single dime the American people are owed,” Obama said in a statement released this morning. “My determination to achieve this goal is only heightened when I see reports of massive profits and obscene bonuses at the very firms who owe their continued existence to the American people.”

US data

The US Census Bureau announced today that advance estimates of US retail and food services sales for December, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $353.0 billion, a decrease of 0.3% from the previous month, but 5.4% above December 2008. Total sales for the 12 months of 2009 were down 6.2%  from 2008. Total sales for the October through December 2009 period were up 1.9%  from the same period a year ago.

The October to November 2009 percent change was revised from +1.3% to +1.8%. Retail trade sales were down 0.2% from November 2009, but 5.9% above last year. Gasoline stations sales were up 33.6% from December 2008 and nonstore retailers sales were up 10.3% from last year.

Consumer spending makes up 70% of GDP, which is the broad measure of U.S. economic activity.

Initial claims for jobless benefits rose by 11,000 to 444,000 in the week ended Jan. 9th, according to the Labor Department's weekly report Thursday. The previous week's level was revised to 433,000 from 434,000.

The four-week moving average, which smoothes volatility in the data, dipped to the lowest level since August 30, 2008

The number of continuing claims -- drawn by workers for more than one week - - in the week ended Jan. 2nd, fell by 211,000 to 4,596,000 from the preceding week's revised level of 4,807,000.

US business inventories increased 0.4% in November, to $1.3 trillion, mainly related to rising wholesale and manufacturing stockpiles, the Commerce Department announced Thursday.

November business sales rose 2% from October to $1.0 trillion, the highest level since November 2008, according to the Commerce Department.