European Central Bank president Jean-Claude Trichet said today that he was ready to cut interest rates, but declined to comment further.
'We are ready to cut interest rates,' Trichet said in Cairo, declining to say when or by how many percentage points.
The ECB lowered its main rate twice in October and November by a half percentage point each time, bringing the benchmark cost of borrowing in the euro zone to 3.25%.
But critics have charged that the bank's approach is timid, and point to much larger cuts by the US Federal Reserve and Bank of England.
The ECB governing council meets on December 4 in Brussels and is widely expected to lower its main lending rate by at least another 0.50 percentage points, and possibly more.
'We are currently experiencing an extraordinary and very challenging period, characterised by severe financial market turmoil that originated in advanced economies,' Trichet said.
'Recently, the tensions in the financial sector have spilled over into the real economy and have dampened significantly global growth,' he added.
Trichet, in Cairo to sign a memorandum of understanding with the Central Bank of Egypt to intensify cooperation between the two institutions, called for more long-term thinking.
