ECB Cuts Rates A Half

European Central Bank this afternoon cut benchmark interest rates by half a percentage point to 3.25 percent.

The move was widely expected. The ECB, as usual did not give any further explanation, so all the eyes were set on a press conference subsequently held by Mr. Trichet.

In it he said, "We were unanimous in thinking that the significant decrease of rates was appropriate in the present circumstances."

"We discussed several options. Options of diminishing rates by 50 basis points, options of diminishing rates by 75 basis points. All taken into account, after having checked and discussed the pros and cons of those different options, we decided unanimously it was appropriate to decrease by 50 basis points."

"I don't exclude that we could decrease rates again. Again, we are not precommitted in any respect, we'll do whatever is necessary to take into account the situation as it will unfold progressively," he added.