Europe, Central Bank | featured news

As Cypriot politicians raced to find a new financial rescue plan ahead of a Monday deadline, tensions built in the streets of the capital. Residents withdrew what money they could from ATMs amid concern the banks could collapse.

The European Central Bank is prepared to cut off funding to Cyprus and let the Mediterranean island succumb to financial meltdown if it has to, confident it has unlimited firepower to protect the rest of the euro zone.

The European Central Bank has left its benchmark interest rate unchanged at a record low of 0.75 percent, holding off on further stimulus even though the euro area remains stuck in recession.

The data is likely to put pressure on the European Central Bank to cut interest rates at its next meeting.

Britain named Canadian central bank chief Mark Carney on Monday as the next governor of the Bank of England, springing the surprise choice of a foreigner to help steer the world's sixth-largest economy out of stagnation.

Financial markets will still be waiting to see whether the bank’s president, Mario Draghi, has other moves in mind.

Markets and the euro rose after Mario Draghi reportedly told a conference in London that the central bank would “do whatever it takes to preserve” the currency.

World stock markets rebounded Friday on anticipation that central banks will act to keep any political instability in Greece following weekend elections from destabilizing the global economy.

Inflation in the euro zone fell to its lowest level in more than a year in May, giving the European Central Bank more leeway to stimulate the flagging 17-nation economy as the intensifying debt crisis takes its toll on confidence.

The European Central Bank stepped up pressure on Thursday for a joint fund to guarantee bank deposits in the euro zone, saying Europe needed news tools to fight bank runs as the bloc's debt crisis drives investors to flee risk.