BERLIN -- Get ready, Europe! The European Central Bank is going on tour to bring the exciting world of monetary policy to a central bank near you!

Europe's monetary authorities will leave dreary Frankfurt behind next Thursday to head to sunny Madrid to discuss the current state of the Continent's interest rates, the first meeting of the bank to be held outside of Frankfurt. The bank is attempting to dispel the notion that the ECB's monetary policy is excessively Teutonic and not sufficiently pan-European.

Indeed, prior to the bank's quarter-point rate hike on March 16, many observers thought the ECB would raise rates at the Madrid outing. The increase would send a pan-European message by raising borrowing costs in a country that would most certainly have higher interest rates were it not part of the monetary union. However, now most ECB watchers contend another rate hike in the coming week would be too soon. Instead, the

Banco de Espana

field trip will most likely focus on regional issues that often get lost in the shuffle when the bank's Governing Council meets in Frankfurt.

However, now that the ECB has shown itself to have an activist and incremental penchant in raising interest rates, an outside chance remains ECB President

Wim Duisenberg

and his cohorts could choose to pop another small rate hike surprise on the markets.

The odds of such a move depend heavily on the eurozone February M3 money-supply figures, due to be released at some point next week. Should the data come in stronger than expected, interest-rate-sensitive stocks such as banks and insurers could be hit, since the ECB in the past has justified rate increases on money-supply movements.

"As ever, what matters about the M3 release is not just the number itself, but the way in which the ECB bankers choose to spin that number," says Alison Cottrell, an economist for

PaineWebber International

in London.

Still most eurozone analysts figure the bank won't be that gung-ho and ratchet up its current 3.5% main refinancing rate on Thursday, although in the following weeks all bets are off. According to

Deutsche Bank's

economic weekly: "The ECB should remain on hold at this week's meeting, with the next hike coming by early May at the latest."

The ECB broke tradition on March 16 by raising rates without holding a press conference to explain the move. The next hike could happen any time the Governing Council meets -- possibly as soon as next meeting on April 13. As for having an opportunity to make a monetary policy decision outside of Frankfurt, the ECB's next chance won't come until the autumn, when a Governing Council meeting has been scheduled for Paris. The ECB now plans to hold meetings in other European cities on an informal basis, most likely a couple of times a year.

The ECB sets monetary policy for Germany, France, Italy, Spain, Portugal, the Netherlands, Belgium, Finland, Luxembourg, Ireland and Austria.