President of European Central Bank Mario Draghi smiles during a press conference following a meeting of the governing council in Frankfurt, Germany, Thursday, March 10, 2016. (Arne Dedert/dpa via AP)
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The European Central Bank unleashed some of it last remaining stimulus weapons on Thursday, cutting all three of its interest rates and expanding asset-buying to boost the economy and prevent ultra-low inflation becoming entrenched.While the deposit rate was cut 10 basis points to -0.4 percent, the main refinancing rate was shaved to zero from 0.05 percent and its marginal lending rate – used by banks to borrow from the ECB overnight – fell to 0.25 percent from 0.3 percent.The ECB said it would also start buying corporate debt and launch four new rounds of cheap loan packages, to be extended by banks to the real economy.Slashing its 2016 inflation forecast from one percent to just 0.1 percent, the Bank said further rounds of ultra-cheap four-year loans to banks could include extra financial sweeteners for them to take up the offer to pass on to others.Inflation has been below the ECB's nearly 2 percent target for three years and is likely to remain so for many more.
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