02 May 2013

ECB / EUROZONE : Draghi Cuts Benchmark To Record Low 0.5%.


     Many economists predicted it...and the ECB's Mario Draghi made it come true.
     The ECB's new benchmark rate is 0.5%...down 25 bps from 0.75%.
     It's the bank's first rate cut in 10 months.
     Draghi is trying to stimulate growth...after new stats indicated that manufacturing has contracted in the zone's 17 nations...including powerhouse Germany.
     Yesterday...the USA's Federal Reserve said it would continue to buy $85 billion in bonds monthly...to further drive down long term interest rates.
     Eurozone inflation is at a 3-year low.
     Draghi hinted that rates could go lower if necessary...possibly even negative deposit rates.
http://www.bbc.co.uk/news/business-22369765