The US Federal Reserve has cut interest rates from 1.75 per cent to 1.25 per cent. A reduction in the cost of borrowing leaves market watchers anticipating a 'triple witching', with the Bank of England and the European Central Bank set to announce interest rate decisions.
Just two weeks ago many Fed officials were describing interest-rate policy as "accommodative,'' meaning that rates were low enough to help the economy grow at a faster pace.
But speculation of a US rate cut has grown in the wake of a raft of poor economic numbers and consumer surveys.
Rising US unemployment and declining consumer confidence since the last Fed policy meeting six weeks ago has changed perceptions about the hoped-for US recovery.
Last Friday, the Labour Department reported the economy lost 5,000 jobs in October and the unemployment rate rose to 5.7 per cent.
Figures revealed that consumer confidence has plunged, durable orders have tumbled, while the latest GDP figures came in lower than hoped.
