* All 79 economists see no hike until at least April
* Medians say first ECB rate rise in Q4 2011
* Economists give just 5 pct chance of hike this year
(Adds details, graphic)
By Jonathan Cable
LONDON, Sept 29 (Reuters) - The European Central Bank will hold interest rates at record lows for at least another year as it battles to revitalise a struggling economy and bring inflation back up to target, a Reuters poll found.
None of the 79 economists polled this week said the central bank would shift rates from 1.0 percent when it meets on Oct. 7, or even before next April, with forecasters giving just a median 5 percent chance of a rate hike by the end of this year.
That is down from 10 percent in a poll taken last month.
The poll median pointed to a higher 25 percent chance of a hike by the middle of 2011, but the results suggested the central bank would not begin hiking rates until next October at the earliest, in line with a poll taken earlier this month. [ECILT/EU]
The poll suggested ECB rates would rise by 25 basis points to 1.25 percent in the final three months of 2011 and then by an additional 25 basis points each quarter to the end of June 2012.
"The economy is slowing, which will keep a lid on inflation pressures, allowing low rates to remain in place for a considerable period," said Ken Wattret at BNP Paribas.
One year ago, just as the euro zone was escaping from its deepest recession in post-war history, analysts saw a rate hike by the end of 2010 as a foregone conclusion amid expectations for a quickening economic recovery.
Yet a Reuters poll of economists taken earlier this month showed euro zone growth slowing to a crawl over coming quarters as austerity packages begin to bite, though the chances of the bloc slipping back into recession remain slim.
Median forecasts from that separate poll of around 70
economists are that the 16-nation bloc will grow by a modest 0.2
to 0.4 percent each quarter through to the end of next year.
The latest poll also found the ECB's handling of the sovereign debt crisis has taken some of the shine off its image but Jean-Claude Trichet received a clear thumbs-up as he heads into his final year as president. [ID:LDE68Q1O8]
Trichet got a rating of 8 of out 10 for his performance in the last seven years. A minority of economists, 18 of 47, said the ECB's reputation had worsened as a result of the sovereign debt crisis, marked by several ECB policy U-turns including on offering exemptions from its collateral rules for Greece.
DIVISION
Worryingly for policymakers, recent data have highlighted a two-speed recovery in Europe with the largest euro zone economies, Germany and France, performing far better than struggling peripheral countries like Greece and Ireland. [EUR/PMIS]
Inflation, which the ECB targets at close to, but below 2.0 percent, is low. Preliminary data due on Thursday are expected to show inflation at 1.8 percent this month, faster than 1.6 percent in August but still below the ECB's target ceiling. [ID:nLDE68N0KZ]
ECB Governing Council member Yves Mersch said on Tuesday
that euro zone inflation would remain below the central bank's
target in coming years, holding at around 1.5 percent -- roughly
in line with what many economists think.
(Polling by Bangalore Polling Unit; editing by Stephen Nisbet)