The European Central Bank in Frankfurt has unveiled the new euro currency notes for the first time. The move came as the bank announced a cut in interest rates.
The European Central Bank President described the unveiling as a "historic moment". Wim Duisenberg said that the euro was not just a currency integrating markets within Europe, but was also a powerful symbol of European unity.
Euro notes and coins will begin circulating in twelve countries in the Eurozone on 1 January next. The notes have several security features,
including holograms, making them difficult to forge.
Before the unveiling, the European Central Bank announced that it had decided to cut interest rates by 0.25%. This brings interest rates in the Eurozone to 4.25%.
This is the third rate cut by the European Central Bank in the two years and eight months that it has been in charge of Europe's monitory policy. The cut is good news for mortgage holders who as the financial institutions here follow suit.
Irish Permanent and First Active have cut their mortgage interest rates. First Active will reduce its standard variable rate for new business by a quarter of a point to 5.63% from Monday. It will also cut its standard variable rate for existing customers by a quarter-point from Thursday 4 October.
Irish Permanent and TSB Bank are cutting their variable home loan rates by a quarter of a point to 5.64%. They are also lowering their range of fixed rates by up to 0.35 points.
The cut had been widely expected, but was by no means a certainty. Statistics show growth and inflation in the Eurozone slowing down, making the case for a rate cut.
A board member said earlier this week that the ECB's first duty was to ensure price stability, not to promote economic growth and employment. Nonetheless, many market observers will be hoping that cheaper loans will mean European consumers have greater spending power, to help promote economic growth.
The ECB had, until now, resisted growing pressure to follow the US Federal Reserve, which has made several cuts in recent months.
