It was a spirited president of the European Central Bank who gave his last but one press conference on Thursday. Jean-Claude Trichet hit some valedictory notes defending the ECB’s record on inflation and its handling of the crisis. Nevertheless, Mr Trichet and his colleagues compounded a mistake by leaving in place rates they wrongly raised in April and July.

In reporting downgraded forecasts for growth and inflation, Mr Trichet joined the chorus of those observing the world economy powering down. On the same day, the Organisation for Economic Co-operation and Development issued its own sharply reduced forecasts. After saying growth prospects warranted interest rises in the spring, the OECD now expects stagnation across the industrialised world for the rest of the year – and a contraction in Germany. Similar pessimism made the Bank of England’s monetary policy committee hold its policy rate unchanged at the record-low level of 0.5 per cent.

That makes it all the stranger for the ECB not to reverse its earlier rate rises. The risks to growth are now on the downside and the upward risks of inflation have abated. On most measures, the quantity of money and credit in the eurozone is stagnant or shrinking in real terms. When should interest rates be cut, if not now?