Trichet Hints No Cut in January

The president of the European Central Bank or ECB Jean-Claude Trichet “hinted” that there would not be an additional interest rate cut at their January meeting. He says that the current cuts need to be “transmitted into the real economy.” The current rate is 2.5 percent, down from 3.25 percent.

He also cautioned European countries to be careful about borrowing; confidence is lost with countries near their maximum. EU countries are only allowed budget deficits of 3 percent of their GDP; some member countries have called to have that rule eased.