LONDON (Reuters) - Five years after the onset of the global financial crisis, the world economy is in such a chronic condition that the European Central Bank might cut interest rates this week and the Federal Reserve is likely to indicate no let-up in the stimulus it is providing the U.S. economy.
With the euro zone economy in recession, momentum is building for the ECB to lower interest rates for the first time since July 2012, according to senior sources involved in the deliberations.
If the bank does not act on Thursday, a quarter-point cut in June is considered a racing certainty.
The ECB is the most conservative of the world's main central banks. Its main short-term rate, now at 0.75 percent, is higher than the equivalent rate of the Fed, the Bank of England and the Bank of Japan. And unlike its peers the ECB has not engaged in quantitative easing - printing new money to buy bonds.
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