The ECB has pulled back from its tightening path. Reuters reports:
The European Central Bank signaled on Thursday that it had halted a cycle of interest rate rises begun just five months ago, saying euro zone inflation risks were no longer skewed to the upside and economic growth would be slow at best.
ECB President Jean-Claude Trichet said there were "intensified downside risks" to the economic outlook for the 17-country euro zone, marking a significant change in stance from last month when the bank was focused on inflation risks.
The ECB left its benchmark rate at 1.5 percent.
The Bank of England also left interest rates unchanged at 0.5 percent on Thursday.
The OECD would probably have approved these decisions. In a report released on Thursday, it said that economic recovery appears to have come "close to a halt" in the major industrialised economies. It recommended that central banks keep policy rates at present levels and consider lowering rates "when there is scope".
A faltering economic recovery certainly looks a real risk in Japan, based on data released on Thursday. Core machinery orders fell 8.2 percent in July, a sharp reversal from the 7.7 percent rise in June.
In addition, the economy watchers survey index fell sharply to 47.3 in August from 52.6 in July. The outlook index from the survey fell to 47.1 from 48.5.
Japan's current account surplus also disappointed, coming in at 990 billion yen in July, down 42.4 percent from a year earlier.
Germany also reported disappointing trade data on Thursday. Exports fell 1.8 percent in July, a second consecutive month of decline following June's 1.2 percent fall.
Trade data from the US, however, looked better with the trade deficit narrowing in July after exports climbed 3.6 percent to a record level while imports fell 0.2 percent.
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