By Maximilian

Further evidence, were it needed, of the eurozone’s worsening financial crisis came today after the European Central Bank announced a 0.25% reduction in its interest rate.

Differeing from its British counterpart, the European Central Bank has been more hawkish in policy- favouring higher interest rates in order to tighten fiscal control and maintain lower inflation. But today’s decision by the 23- strong panel suggests even the hawks are relaxing controls in a bid to stimulate lending.

“Much like in 2008 the ECB has had to reverse a string of rate hikes, as the continent teeters on the brink of a recession,” commented Nick Jones, Chief Economist at World First forex brokers.

“It’s good to see the new ECB governor, Mario Draghi, come out swinging. Hopefully this will form part of a concerted effort to drag the Eurozone economy off the canvas.

“We expect another rate cut next month as well, to completely erase the rises seen earlier this year.”


Join us on
Follow @freshbusiness

Topics