European Economy: Pressure Mounts for Rate Cuts

The Bank of England and European Central Bank may have little choice but to cut interest rates to help avoid a long-term recession in Europe

The last two months have been a roller-coaster ride for the European economy. Plunging stock markets, multi-billion-dollar government financial bailouts, and faltering consumer confidence have marked the spread of the credit crisis well beyond the banking sector. Now people from Spain to Slovenia are turning to politicians and policymakers in the hope of staving off a long-term European recession.

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