The European Union’s Central Bank announced Thursday it would be cutting interest rates yet again to the lowest rate it has ever issued, a cut which is unexpected to be its last.

This cut is somewhat insignificant, compared to the rates seen in the rest of the world - the U.S. central bank, the Federal Reserve, who declared this week that interest rate cuts would be insufficient, has rates sitting at less than 0.25 per cent. The Bank of England dropped rates to 1.5 per cent just last week.

Analysts suggest however, this is indicative of economic recession in Europe lagging behind that of its North American counterparts, a theory held by many economists.

The president of the European Central Bank, Jean-Claude Trichet, said it will hold out until at least mid-March to make decisions about further cuts - a move which most economists expect the Bank to make. The European Central Bank entered the contractionary economy, with formal declaration in October, with an interest rate of over 4 per cent.

 Print This   Email This