Draghi disappoints

European Central Bank President Mario Draghi may be prepared to do “whatever it takes to preserve the euro”, but not right now.

Reuters reports the outcome of the ECB monetary policy meeting on Thursday:

In the latest move to contain the euro zone crisis, ECB President Mario Draghi indicated that any intervention would not come before September - and only if governments activated the euro zone's bail-out funds to join the ECB in buying bonds.

"The Governing Council ... may undertake outright open market operations of a size adequate to reach its objective," Draghi told a news conference after the central bank's monthly meeting, using the central bank's code for bond-buying.

The ECB kept euro zone interest rates at a record low 0.75 percent but Draghi said the council did consider a further rate cut on Thursday amid signs that an economic recession in peripheral European countries is spreading across the continent.

Investors reacted predictably to the lack of action from the ECB. Spain's 10-year yield rose 43 basis points to 7.17 percent on Thursday. Italy's 10-year yield rose 40 basis points to 6.33 percent.

There was also no new action from the Bank of England, which held its policy rate at 0.5 percent after its monetary policy meeting on Thursday.

The UK did provide a piece of positive news in the form of an improvement in construction activity. The Markit/CIPS construction PMI rose to 50.9 in July from 48.2 in June.

However, economic data from the US on Thursday showed weakening activity. Initial claims for jobless benefits rose 8,000 to 365,000 last week while factory orders fell 0.5 percent in June, reversing the 0.5 percent increase in May.