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Markets fall after inaction on euro

Thursday 02 August 2012

The UK was facing more economic uncertainty tonight after the European Central Bank failed to deliver measures for tackling the region's debt crisis.

Markets fell sharply as ECB president Mario Draghi dashed hopes that he would signal an imminent move into bond markets to ease Spain's borrowing costs.

Uncertainty over the future of the euro has already deepened the UK's double-dip recession, with output down 0.7 per cent in the second quarter of 2012.

The ECB also kept its main interest rate on hold at 0.75 per cent, capping a week of inactivity from policymakers after the US Federal Reserve and the Bank of England opted to sit on their hands.

The Bank's monetary policy committee (MPC) is hoping that existing measures such as last month's additional £50 billion of quantitative easing and this week's launch of a “Funding for Lendin

Added: Aug-2-2012 Occurred On: Aug-2-2012
By: gemini
Regional News
Tags: euro, crisis
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