Can the record low European rate stave off deflation?

Taha Lokhandwala looks at the impact of the ECB’s decision to cut interest rates

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The move last week by the European Central Bank (ECB) to cut its baseline rate from 0.5% to 0.25% sent the euro tumbling against the dollar and caused rally in equities.

October's inflation report from the ECB made grim reading. Concerns about more deflation took centre stage as the annual rate of inflation fell to 0.7% on the consumer prices index (CPI). This i...

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