Europe Central Bank jumps ahead of U.S. in lowering rates [Video]

FRANKFURT, Germany –

The European Central Bank cut its key interest rate Thursday by a quarter-point, moving ahead of the U.S. Federal Reserve as central banks around the world lean toward lowering borrowing costs — a shift with far-reaching consequences for home buyers, savers and investors.

The ECB cut its benchmark rate to 3.75 per cent from a record high of 4 per cent at a meeting of the bank’s 26-member rate-setting council in Frankfurt.

Speaking afterward at a news conference, ECB President Christine Lagarde said inflation had eased enough for the central bank to start lowering rates.

• The information you need to know, sent directly to you: Download the CTV News App

But with annual inflation at 2.6 per cent in May and expected to remain above the ECB 2 per cent target into next year, Lagarde declined to indicate how fast or how deep any future rate cuts might be.

“We …