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

Mood Tense Ahead of Scotland Independence Vote

As race to persuade undecided voters continues, No voters say they believe life in Scotland will slowly improve and do not want to take a risk by endorsing independence More

South Africa’s 'Open Mosque' Admits Everyone, Including Critics

Open Mosque founder plans to welcome gay worshipers and allow women to lead prayers More

Ukrainian Activist in Despair About Future of Her Country

IrIna Dovgan, accused of being a spy and tortured by pro-Russian separatists, is appealing to UN Human Rights Council to support her country More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
A Dinosaur Fit for Land and Wateri
X
September 17, 2014 8:44 PM
Residents and tourists in Washington D.C. can now examine a life-size replica of an unusual dinosaur that lived almost a hundred million years ago in northern Africa. Scientists say studying the behemoth named Spinosaurus helps them better understand how some prehistoric animals adapted to life on land and in water. The Spinosaurus replica is on display at the National Geographic museum. VOA’s George Putic has more.
Video

Video A Dinosaur Fit for Land and Water

Residents and tourists in Washington D.C. can now examine a life-size replica of an unusual dinosaur that lived almost a hundred million years ago in northern Africa. Scientists say studying the behemoth named Spinosaurus helps them better understand how some prehistoric animals adapted to life on land and in water. The Spinosaurus replica is on display at the National Geographic museum. VOA’s George Putic has more.
Video

Video Iraqi Kurdistan Church Helps Christian Children Cope find shelter in churches in the Kurdish capital, Irbil

In the past six weeks, tens of thousands of Iraqi Christians have been forced to flee their homes by Islamic State militants and find shelter in churches in the Kurdish capital, Irbil. Despite U.S. airstrikes in the region, the prospect of people returning home is still very low and concerns are starting to grow over the impact this is having on the displaced youth. Sebastian Meyer reports from Irbil on how one church is coping.
Video

Video NASA Picks Boeing, SpaceX to Carry Astronauts Into Space

The U.S. space agency, NASA, has chosen Boeing and SpaceX companies to build the next generation of spacecraft that will carry U.S. astronauts to the International Space Station by the year 2017. The deal with private industry enables NASA to end its dependence on Russia to send space crews into low Earth orbit and back. Zlatica Hoke has more.
Video

Video Future of Ukrainian Former President's Estate Uncertain

More than six months after Ukraine's former President Viktor Yanukovych fled revolution to Russia, authorities have yet to gain control of his palatial estate. Protesters occupy the grounds and opened it to tourists but they are also refusing to turn it over to the state. VOA's Daniel Schearf reports from Mezhigirya, just north of Kyiv.
Video

Video China Muslims Work to Change Perceptions After Knife Attacks

China says its has sentenced three men to death and one woman to life in prison for a deadly knife attack in March that left more than 30 dead and 140 injured. Beijing says Muslim militants from China's restive western region of Xinjiang carried out the attacks. Now, more than six months after the incident, residents in the city are still coping with the aftermath. VOA's Bill Ide has more from Kunming.
Video

Video Enviropreneur Seeks to Save the Environment, Empower the Community

Lorna Rutto, a former banker, is now an ‘enviropreneur’ - turning plastic waste into furniture and fences discusses the challenges she faces in Africa with raw materials and the environment.
Video

Video West Trades Accusations Over Ransoms

As world leaders try to forge a common response to the threat posed by Islamic State militants in Iraq and Syria, there is simmering tension over differing policies on paying ransoms. In the past month, the jihadist group has beheaded two Americans and one Briton. Both countries refuse to pay ransom money. As Henry Ridgwell reports for VOA from London, there is uncertainty in the approach of some other European nations.
Video

Video Scotland Independence Bid Stokes Global Interest

The people of Scotland are preparing to vote on whether to become independent and break away from the rest of Britain, in a referendum being watched carefully in many other countries. Some see it as a risky experiment; while others hope a successful vote for independence might energize their own separatist demands. Foreign immigrants to Scotland have a front row seat for the vote. VOA’s Henry Ridgwell spoke to some of them in Edinburgh.


Carnage and mayhem are part of daily life in northern Nigeria, the result of a terror campaign by the Islamist group Boko Haram. Fears are growing that Nigeria’s government may not know how to counter it, and may be making things worse. More

AppleAndroid