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ECB can cut rates further: report

  The European Central Bank has “a certain leeway” when it comes to cutting interest rates, a key member of the ECB’s governing council said Friday, suggesting rates would fall further.

“Regarding monetary policy, I still think there is a certain amount of leeway we can take advantage of,” Axel Weber, who is also governor of the German central bank, said in a speech here.

The ECB slashed interest rates by 50 basis points to 1.50% in March, its lowest level ever, as it tries to pull the euro zone economy out of its first recession ever. Since October, the ECB has cut rates by a whopping 275 basis points, Weber pointed out.

He declined to say where he thought interest rates would end up but dropped a reference to a “floor” of 1% that he has mentioned frequently in recent speeches. (The Economic Times)