London/Beijing: Continuing efforts to prop up their sagging economies, European and Chinese central banks on Thursday slashed interest rates while the Bank of England unveiled fresh stimulus measures worth 50 billion pounds.
The latest moves come at a time when both the developed and the developing world -- including India and China -- are facing sluggish growth prospects and high unemployment levels.
Seen as a surprise, the People's Bank of China cut rates for the second time within a month, amid the economy witnessing one of the worst slowdowns in the recent years.
The European Central Bank too eased their monetary stance, as part of efforts to boost the fortunes of the region reeling under a severe debt turmoil.
Embarking on the stimulus path again, the Bank of England has come up with another round of steps that would pump in another 50 billion pounds into the system.
The Chinese apex bank has slashed key lending rates to 6 percent from 6.31 percent. The deposit rate too has been cut to 3 percent from 3.25 percent.
Unlike India, China in recent weeks has been providing incentives to bolster their economic growth.
Despite high expectations, the Reserve Bank of India last month decided to hold rates, citing that monetary easing could further exacerbate inflationary pressure.
The European Central Bank has cut the benchmark interest rate to record low of 0.75 percent from 1 per cent. Further, ECB has reduced the interest rate on marginal lending facility to 1.50 percent from 1.75 percent.
"The interest rate on the deposit facility will be decreased by 25 basis points to 0 percent," it said.
The Bank of England today increased the size of its asset purchase programme, that would see another 50 billion pounds coming into the system. With this, the total size of asset purchase programme has ballooned to 375 billion pounds.
First Published: Thursday, July 5, 2012, 19:47