ECB cuts interest rate by 0.25%p..."Growth momentum is dampened".

European Central Bank, ECB cut policy rates for third consecutive time

The ECB held its last monetary policy board meeting this year in Frankfurt, Germany, on the 12th local time, to cut the deposit rate by 0.25 percentage points from 3.25% to 3.00% and the key rate from 3.40% to 3.15% respectively.

As a result, the gap between the U.S. Federal Reserve (Fed) benchmark interest rate and the ECB deposit rate widened to 1.50 to 1.75 percentage points.

Growth picked up in the third quarter, but growth slowed this quarter, the ECB said, predicting that the effects of restrictive monetary policy will gradually fade over time, supporting a recovery in domestic demand.

ECB President Christine Lagarde told a news conference that the recovery in growth in the third quarter stemmed from one-off factors such as a boom in tourism in the summer months, and recent indicators show that growth momentum is dampening, explaining that manufacturing has still contracted and service growth is also slowing.

The ECB also cut its outlook for eurozone economic growth this year to 0.7% from 0.8% and next year's forecast to 1.1% from 1.3%.