Quarter-point cut to deposit rate, to 2.5%, comes as Trump prepares to impose tariffs on EU exports to US

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The European Central Bank has cut interest rates across the 20-member eurozone for the second time this year, and warned that trade war fears were hurting Europe’s economy.

The Frankfurt-based rate setter cut its benchmark deposit rate by a quarter of a percentage point to 2.5%, in line with City economist expectations, as Trump prepared to impose 25% tariffs on all goods imported from the EU, in line with similar actions taken against Canada and Mexico.