The European Central Bank cut interest rates for the second time this year. File picture: Frank Rumpenhorst / dpa via AFP.Europe's main stock markets and the euro climbed on Thursday as the European Central Bank cut interest rates for the second time this year.
It was the same size as its previous cut in June, which marked the end of a record hiking cycle that began in mid-2022 to a tame a surge in consumer prices.Frankfurt and Paris stocks gave up some of their gains following the ECB announcement which gave no indication on future rate cuts and was accompanied by a slight reduction in its growth forecasts.
A US consumer inflation reading Wednesday allowed investors to breathe a sigh of relief after a tough couple of weeks that have been filled with worries about the world's top economy, as a weak run of jobs figures stoked recession fears. The Fed is yet to cut borrowing costs after central banks around the world hiked aggressively when inflation soared as nations emerged from Covid lockdowns and following Russia's invasion of Ukraine.Bets have surged on a 25-basis-point reduction rather than a bigger 50-basis-point cut after Wednesday's data showed core inflation had seen an unexpected uptick.