ECB policymakers 'will consider interest rate cut'

21 June 2012

Policymakers at the European Central Bank (ECB) will discuss the possibility of cutting interest rates further during their next meeting.

That is according to Benoit Coeure, executive board member at the body, who told the Financial Times a reduction from the current record-low figure of one per cent is "certainly an option" to stimulate the European economy.

However, Mr Coeure also insisted such action would only act as a quick-fix solution to the region's deep-seated financial problems and would ease the area's "fundamental" issues.

He also went on to question the wisdom of struggling governments opting to avoid using the European Financial Stability Facility, but added that the ECB has no plans to buy more bonds through its Securities Markets Programme.

"It's a mystery why the EFSF was allowed almost a year ago to undertake secondary market interventions and governments have not yet chosen to use that possibility," the official stated.

By Asim Shah

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