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Business Words in the News
Friday 12 October 2001
Vocabulary from the business news. Listen to and read the report then find explanations of difficult words below.

  European Central Bank and Euro note
Eurozone leaves interest rates unchanged
Summary: The European Central Bank has decided not to cut interest rates, despite growing economic gloom since the terrorist attacks in the USA. The decision suggests the ECB believes it's unlikely Europe will follow America to the brink of recession. This report from Patrick Bartlett:
   
The News Listen  
  Three weeks ago, the European Central Bank joined other central banks around the world in a coordinated half percent rate cut. It was a dramatic reaction to a global crisis of confidence, following the tragic events of September the 11th.

The ECB's president, Wim Duisenberg, implied that to cut again so soon would smack of panic and that, said Mr Duisenberg, would be more likely to harm consumer and business confidence. Mr Duisenberg said it was in any case too soon to judge the economic impact of the attacks in America. Overall, he said, despite the uncertainty, the bank believed the Eurozone economy was fundamentally sound. He was confident recovery would come next year.

The ECB's decision to hold the cost of borrowing will be a disappointment to several European governments who'd urged a cut. Once again, Mr Duisenberg stressed the bank's role was to control inflation and not to stimulate the economy.

The ECB's reaction could not be in sharper contrast to that of America's Federal Reserve, which has slashed rates to their lowest level in almost forty years. But most economists agree America is much closer to recession than Europe. Nonetheless, they still expect Eurozone rates to be cut by another half of one percent before the end of the year.

PATRICK BARTLETT, BBC, FRANKFURT

 
   
The Words Listen
 
  a coordinated rate cut
a reduction in interest rates which had been agreed and was effected by many countries at the same time

 
   
  crisis of confidence
here - feeling deeply uncertain about the future of the economy

 
   
  smack of panic
if one thing smacks of another thing that you consider bad, then it reminds you of it or is like it

 
   
  business confidence
feeling certain about the future of your business

 
   
  fundamentally sound
in a good state by most of the vital economic indicators, for example inflation, growth, etc.

 
   
  recovery
here - an improvement in the state of the economy

 
   
  to hold the cost of borrowing
to keep interest rates unchanged

 
   
  to stimulate the economy
to cause the economy to grow

 
   
  could not be in sharper contrast
was clearly opposite

 
   
  slashed rates
reduced rates by a large amount (the expression is commonly used by journalists)

 
   
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