European Central Bank President Mario Draghi said the bank has averted a serious credit shortage and there are signs the economy is stabilizing, signaling policy makers may resist cutting interest ratesfurther for now.

"According to some recent survey indicators, there are tentative signs of stabilization of economic activity at low levels," Draghi said at a press conference in Frankfurt today after the ECB kept its benchmark interest rate at 1 percent following two straight reductions. While the debt crisis poses "substantial downside risks" to the economic outlook and the ECB remains "ready to act," Draghi gave no indication that another rate cut is imminent.

With the euro area on the brink of a second recession in three years, some signs of economic resilience have given the ECB room to assess the impact of its stimulus measures to date, which include lending a record amount of cash to banks. Draghi said those loans prevented a "serious" credit contraction. He also noted that borrowing costs for governments across the 17- nation region have dropped.

The euro climbed to $1.2790 at 4.40 p.m. in Frankfurt from $1.2739 before Draghi's press conference started.

David Fuller's view Fullermoney has maintained since November that the Eurozone crisis had passed its nadir in terms of its negative influence on other markets. If correct, and I think Mr Draghi is right, a change in perceptions has commenced relative to widespread yearend forecasts that the Eurozone would fall apart. Over the next year or two I think we will gradually hear less talk of the European crisis, at least in the present tense, and more references to the European recession. That will still be a problem, but less threatening for the global economy.

For tangible evidence that the transition has commenced, see Eoin's review of key European yield curves below.