News / Asia

China, Europe Cut Key Lending Rates

A 100 Euro banknote is placed on top of a 100 yuan banknote in this illustration taken in Beijing, November 7, 2010.A 100 Euro banknote is placed on top of a 100 yuan banknote in this illustration taken in Beijing, November 7, 2010.
x
A 100 Euro banknote is placed on top of a 100 yuan banknote in this illustration taken in Beijing, November 7, 2010.
A 100 Euro banknote is placed on top of a 100 yuan banknote in this illustration taken in Beijing, November 7, 2010.
VOA News
Two of the world's biggest economies - China and the 17-nation euro currency bloc - are cutting key lending rates in a new effort to boost their flagging economic fortunes.

The Chinese central bank Thursday cut its benchmark lending rate for the second time in a month, signaling that the world's second largest economy is slumping and faced with its biggest economic challenge since the 2008 worldwide recession. Beijing trimmed its one-year lending rate by nearly a third of a percentage point to 6 percent and said banks could offer even steeper discounts to borrowers.

China has offered numerous stimulus measures after its economic output dropped to a three-year low of 8.1 percent in the early months of the year. It has cut gasoline prices and promised more spending on low-cost housing and other public projects.   

Meanwhile, the European Central Bank cuts it key lending rate to a record low - down a quarter of a percent to three-quarters of one percent - as the eurozone economy contracts slightly.

In addition, the Bank of England moved to boost the British economy, which is outside the eurozone but deeply dependent on trading with its European neighbors. The British central bank pumped $78 billion into the country's recession-hit economy.

European Central Bank Chief Mario Draghi said inflation has stabilized in the eurozone at just below 2 percent, but economic growth in the region remains sluggish. "Inflationary pressure over the policy-relevant horizon has been dampened further as some of the previously identified downside risks to euro area growth outlook have materialized," he said.

"Consistent with this picture, the underlying base of monetary expansion remains subdued" he said. "Inflationary expectations for the euro area economy continued to be firmly anchored in line with our aim of maintaining inflation rates below, but close to two percent over the medium term," added Draghi. "At the same time, economic growth in the euro area continues to remain weak with heightened uncertainty weighing on confidence and sentiment."

The precarious financial state of debt-ridden Greece continues to be one of the eurozone's biggest economic problems. International auditors are in Athens to look at the government's progress in meeting the austerity pledges it agreed to as it secured a $168 billion bailout earlier this year, its second rescue package in two years.

New Greek Finance Minister Yannis Stournaras told reporters that some of the spending cuts it promised are "off track" and that the country faces "difficult years" in its recovery effort.

Some information for this report was provided by AP, AFP and Reuters.

You May Like

Video VOA Reporter Tours Devastated Peshawar School

Islamist militants wearing military uniforms and strapped with explosives attacked a military run school Tuesday in the northwestern Pakistani city of Peshawar. At least 141 people were killed in the horrific attack, most of them young students. More

Video Sudan School Becomes Target of Aerial Attacks

Dropout rate at an all-time high in South Kordofan state because many schools have been destroyed during 3-year civil war More

Tennessee Songbirds Fly Coop Long Before Tornadoes Arrive

Researchers say birds apparently alerted to danger by sounds at frequencies below range of human hearing More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
US: Response to Sony Hack Will Be Proportionali
X
Aru Pande
December 19, 2014 1:45 AM
The White House says President Barack Obama considers the cyberattack on Sony Corp. a serious national security matter and that the U.S. will counter with an "appropriate response." VOA correspondent Aru Pande reports.
Video

Video US: Response to Sony Hack Will Be Proportional

The White House says President Barack Obama considers the cyberattack on Sony Corp. a serious national security matter and that the U.S. will counter with an "appropriate response." VOA correspondent Aru Pande reports.
Video

Video Sudan School Becomes Target of Aerial Attacks

The school dropout rate is at an all-time high in Sudan's South Kordofan state because many schools have been destroyed during the three-year civil war between the government and SPLA-N rebel forces. Adam Bailes visited Sudan's Nuba Mountains' region and reports many children are simply too scared to go to school
Video

Video Nigerians Fleeing Boko Haram Languish in Camp Near Capital

In its five-year effort to impose Islamic law in northeastern Nigeria, the Boko Haram extremist group has killed thousands of people and forced hundreds of thousands to flee. Some of those who ran for their lives now live in squalor on the edges of the capital, Abuja. Chris Stein reports for VOA.
Video

Video Putin Says Russian Economy Will Emerge Stronger

Russian President Vladimir Putin has said his country's sinking economy will not only recover but also become stronger, despite falling oil prices and Western sanctions over Ukraine. VOA's Daniel Schearf reports.
Video

Video Detained Turkish Journalists Follow Teachings of US-Based Preacher

The Turkish government’s jailing of critical journalists has sparked international condemnation and is being seen as an effort to undermine the followers of an ailing Turkish preacher based in the United States. VOA religion reporter Jerome Socolovsky has more.
Video

Video ‘Anti-Islamization’ Marches Increase Tensions In Germany

Anti-immigrant rallies in Germany have been building in recent weeks, peaking Monday night in the city of Dresden where tens of thousands of people turned out to demonstrate against what they call the ‘Islamization’ of the West. Germany has offered asylum to more Syrian refugees than any other country, and this appears to have set off the protests. Henry Ridgwell reports from London.
Video

Video Aceh Rebuilt Decade After Tsunami, But Scars Remain

On December 26, 2004 there was an earthquake in the Indian Ocean so powerful it caused the Earth’s axis to wobble a few centimeters. Onshore on the island of Sumatra, the resulting tsunami was devastating. A decade later, VOA Correspondent Steve Herman reports from Banda Aceh, Indonesia, where although there is little remaining evidence of the physical devastation, the psychological scars among survivors remain.
Video

Video Refugees Living in Kenya Long for Peace in the Home Countries

Kenya is host to numerous refugees seeking safe haven from conflict. Immigrants from Somalia face challenges in their new lives in Kenya. Ahead of International Migrants Day (December 18) Lenny Ruvaga has more for VOA News from the Kenyan capital.

All About America

AppleAndroid