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ROME, May 8 (Reuters) - The European Central Bank's main interest rate at 1 percent is "not necessarily the minimum", ECB Executive Board member Lorenzo Bini Smaghi said on Friday, a day after the ECB cut its main refinancing rate to a record low.
"(ECB President Jean-Claude Trichet) has said that this is not necessarily the minimum," Bini Smaghi told Italian television.
"For the moment, we keep this level. The important thing is that banks pass the reduction on to their customers," he said.
The ECB has cut rates seven times in eight months, taking its main refinancing rate down another 25 basis points to 1.0 percent on Thursday in a move widely expected by financial markets. Bini Smaghi said inflation in the euro zone was expected to fall close to zero or even turn negative in coming months before slowly picking up again.
"There are no concerns about inflation at the moment and this is the reason why we are cutting rates," he said.
Regarding the global economy, the Italian ECB member said there were indications that the "rate of decline should slow down in coming months. There are signs of improvement. Towards the end of the year we should see a positive sign." (Reporting by Stefano Bernabei; Editing by Andy Bruce)