ECB cuts key rates, beefs up asset purchase programme

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Frankfurt (AFP)

The European Central Bank on Thursday cut key interest rates and said it would spend tens of billions more to kickstart the chronically weak eurozone economy, sparking a sharp rally in stock markets.

The ECB said it is cutting its central "refi" refinancing rate to zero percent from 0.05 percent previously. At the same time, it lowered the rate on its marginal lending facility to 0.25 percent from 0.30 percent and on the deposit facility to minus 0.40 percent from minus 0.30 percent.

The ECB also announced it would expand the volume of bonds it purchases each month under its programme of quantitative easing to 80 billion euros from 60 billion euros. And it would also start buying corporate bonds under the QE programme, it said.