The European Central Bank has cut its growth forecast for the troubled euro area this year, but said there were enough signs of improvement ahead that it did not need to cut interest rates further, Belfast Telegraph reported.

The decision to hold off and wait for the economy to gather steam underscores the lack of quick fixes the ECB and Europe's institutions have to deal with region's stubborn recession and problems with too much debt.

Bank President Mario Draghi said the economy of 17 European Union countries that use the euro would shrink 0.6% this year compared with the previous forecast of a 0.5% decline.

Draghi, however, stuck with his forecast that the eurozone would begin to see growth at the end of the year. He was also slightly more optimistic about 2014, forecasting 1.1% growth, up from 1.0 % previously.

The ECB also lowered its inflation outlook for this year to an annual 1.4% from 1.6% previously. The inflation forecast for next year was unchanged at 1.3%.