European Central Bank Cuts Rates

The European Central Bank cut interest rates on Thursday for the second time in three months, continuing the slow unwinding of its aggressive stance in stamping out high inflation in the eurozone.

Central bank officials, who set rates for the 20 countries that use the euro currency, lowered the deposit rate by a quarter percentage point to 3.5 percent from 3.75 percent. Inflation has slowed, and the central bank has faced pressure to help the region’s ailing economy. Growth has been weak for more than a year, in part because of anemic household spending and high interest rates holding back investment.

Still, policymakers have taken a cautious approach, lowering rates slowly from their record high because of concerns about stubborn inflation in the services sector, which includes hospitality businesses and insurance. The move on Thursday comes after the central bank cut rates in June, which was the first decrease since 2019.