Source:
ReutersLONDON (Reuters) - Euro zone demand is plunging and price pressures vanishing, business surveys showed on Friday, while central bankers weighed the prospect of deflation.
The Bank of Japan left its key interest rate at just 0.3 percent and said there would be a long road to recovery.
But the United States, Britain and Europe are expected to ease their rates further next month as the worst financial crisis in 80 years hastens recession across much of the globe.
St Louis Federal Reserve President James Bullard said with interest rates low, the U.S. central bank may have to rely on "quantitative easing" to ward off deflation, recalling large BoJ liquidity injections during the 1990s to jump start the economy by flooding it with cash once rates reached zero.
"By announcing and maintaining targets for key monetary quantities, the Fed may be able to ... ward off either a drift toward deflation or excessively high inflation," he said...>
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