The U.S. policy of using interest rates as a major economic policy tool has gone European.
An April 2 report by The Associated Press said the European Central Bank has lowered its benchmark interest rate to a record low of 1.25 percent.
The move affects 16 countries using the euro.
A quarter percentage point reduction, the move came as members of the so-called Group of 20 — the finance ministers and central bank governors of major economies — were meeting in London. The obvious main agenda item was the battered global economy.
A further rate cut is possible, the ECB’s president told the AP.
“Speaking to reporters Thursday after the ECB lowered the key rate from 1.5 percent to 1.25 percent — less than the half percentage point most analysts had expected — Jean-Claude Trichet said that the ‘main policy rate is not the lowest yet,’” the wire service said.
This article was submitted by Kathleen O’Connor, a contributing writer for Biz2Credit. Biz2Credit is a small business marketplace that provides entrepreneurs with the latest industry news and financial advice. Send all questions to email@example.com.