Bank of the world's five "each other" to cut interest rates

After less than an hour before the official Bank of England reduced interest rates by one percentage point after the European Central Bank also announced that it would cut euro zone interest rates by 75 basis points to 2.5 percent in order to stimulate the economy so as to avoid already in recession throughout the euro area economy is more The Depression. And the 75 basis points decline of the European Central Bank has also created a 10-year history of the largest rate cut. It was also BEIJING, announced that the Bank of England to cut interest rates 100 basis points to 2%. This is the UK interest rates after its lowest level in 1951, or in line with market expectations. Swedish central bank cut interest rates sharply on the 4th accident 175 basis points to 2.00 percent, the biggest drop ever for the first time. New Zealand's central bank - Reserve Bank of New Zealand announced on the 4th cut the benchmark interest rate by 1.5 percentage points, from 6.5% to 5%, which New Zealand is the fourth time this year the central bank to cut interest rates, the rate cut is also the largest. New Zealand central bank's benchmark interest rate has also reached a five-year low. Economists divided Earlier on in the Bloomberg News survey of 56 economists, only 16 of them in the correct prediction of the rate cut, In addition, there are 35 economists forecast the rate cut of 50 basis points, while the remaining 4 is forecast to cut interest rates in the range of 100 basis points. In the European Central Bank announced the decision to cut interest rates before the Bank of England and Bank of Sweden has made a major decision to cut interest rates. The Bank of England to cut interest rates at 1% after the announcement, the benchmark interest rate has dropped since 1951 to its lowest level since. Due to the worsening financial crisis and gradually evolved into a global recession, central banks have been taken to a large-scale policy to cut interest rates to stimulate economic recovery. During the 75 basis points rate cut before the European Central Bank has carried out two previous range of 50 basis points rate cut. Nomura Securities economist Laurent Bilke said: "The European Central Bank to cut interest rates 75 basis points of margin than the 50 basis points more obvious effects, but compared to other central banks in the action, the European Central Bank's decision-making are still slow. At present, the global economy as a whole has entered a recession, the policy has come to cut interest rates sooner the better. "In the four earlier this week, the Bank of England and Sweden are the central bank before the European Central Bank took action. Bank of England announced that it would cut the benchmark interest rate 100 basis points to 2%, which makes the country's benchmark interest rate fell to the lowest level since 1951, and in October of this year, the Bank of England has reduced the benchmark interest rate by 150 basis points. In addition, the Swedish central bank also announced a four-week lowered the benchmark interest rate 175 basis points to 2%, New Zealand, the central bank will cut interest rates 150 basis points, while the Bank of Indonesia also made a surprise rate cut for the first time this year. In addition, since the financial crisis at the center of the U.S. government's efforts to have the largest rate cut, the Federal Reserve to cut interest rates this year, the cumulative rate of 325 basis points over the U.S. benchmark interest rate is only 1%. Fortis Bank European economist Nick Kounis, said: "For a long time, the European Central Bank has adopted a more conservative monetary policy. But in the current extremely difficult economic environment, the European Central Bank has no choice but to accelerate the pace of the rescue package." At present, the European economy as a whole are at a very critical situation, in November this year, the European manufacturing and service industries are shrinking speed to create a historical record, into consumer confidence index dropped to nearly 15 years since a new low. On the other hand, inflation as the economy has been the deterioration of the situation and faded, as the emergence of sharp fall in international oil prices, the European inflation rate from October's 3.2 percent drop sharply in November of 2.1 percent, which is also near record In the 20 years since the biggest monthly decline. The International Monetary expected economic organizations, in 2009 the euro-zone economy will be 0.5 percent decline. BusinessEurope group of people responsible for economic affairs Marc Stocker said: "We can see that the global business environment over the past few weeks there have been rapid deterioration, which forced central banks to take more resolute monetary policy. However, the economic crisis is far from over , The European Central Bank must be ready at any time. "In addition, part of the European Central Bank officials are also against anti-recession measures put forward their own views, which many people have expressed reservations about a substantial rate cut. Members of the Executive Committee of the European Central Bank Lorenzo Bini Smaghi on Nov. 25 said that large-scale policy rate cut is likely to make further deterioration of the economic situation, and Ewald Nowotny, another member of the same day that the European Central Bank should be for the future of the currency Policy left some room for rate cuts, rather than a one-time to take a substantial cut policy. Trinity University Professor of Macroeconomics Philip Lane, said: "Although the euro system in the banking sector is not an ideal situation, but the situation in the euro zone and Britain and the United States still has a noticeably different. Please note that the euro's recent sharp decline This is precisely what the previous policy to cut interest rates. "And even though the European Central Bank has cut interest rates several times, but all the major European companies are still pessimistic about the prospects for their exports, Europe's third-largest truck maker MAN AG chief executive Hakan Group Samuelsson said this week that due to the downturn in the global economy, companies operating in 2009 will face immense difficulties at the same time, the company will cut 30% to cope with the economic crisis. In addition, the world's largest chemical company BASF announced last month in 2008 to reduce the expected profit, because most of the customers to reduce the size of the orders, the company decided to suspend its 80 manufacturing plants in order to cut operating expenses. Barclays Bank's chief European economist Julian Callow believes that the European Central Bank's rate cut of 75 basis points rate is still not enough, he said: "Now, Europe's economy has reached the edge of the cliff, while the European Central Bank has not seemed to pay attention to To the situation. If the rate of 100 basis points rate cut, then the situation may turn for the better and faster. "