The US Federal Reserve bank went with caution yesterday when in announced a full 0.5% cut to base int...
As the FT noted today, this brought the number of cuts this year to 10, and now means that real interest rates are effectively zero given the effects of what little inflation there is in the US economy.
And there is more to come, according to the notes released by the committee that decides rate changes.
It said further economic deterioration was likely given the increasing softness of both the US and other economies around the world.
The question now is whether any further cuts will actually be able to reverse the US economy, or whether they will just cushion the blow of a move into full recission.
The FT believes the latter.
News from Europe yesterday did nothing to stem fears of recession, the FT adds.
Government figures showed the services sector slowed in markets such as France and Italy, while Europe's biggest economy Germany recorded its fastest rise in unemployment in some three years.
German chancellor Schroder countered the economic story with his decision to send German troops to Afghanistan if requested, but that is unlikely to remove what will remain a big thorn in his side.
The main business story involving an individual company at The Times focuses on BP's warning yesterday that Opec needs to cut production if the UK company is to return to previous levels of profitability.
The FTSE oil giant released results yesterday that showed excess global output coupled with a general economic downturn has bitten hard into both its top line growth and bottom line earnings.
The Times said chief executive John Browne's call for a cut to oil supplies was "surprising".
Meanwhile, the latest moves in the Afghanistan war involve a step up in US bombing sorties, and a visit to the White House by prime minister Blair.
The Times says the US is now on course to start its ground campaign before winter starts, while the FT reports on president Bush's speech to the effect that members of Bin Laden's group have been seeking to acquire nuclear weapons.
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