A series of surprising and aggressive announcements from the European Central Bank today is sending shockwaves through the global financial markets.

The euro dropped from $US1.3160 to a low of $US1.2996, its lowest level since July 2013. France’s CAC 40 is up 1.3%, Germany’s DAX is up 0.5%, and Spain’s IBEX is up 1.4%.

The ECB announced three rate cuts, including lowering the main refinancing rate to 0.05% from 0.15%, lowering the marginal lending facility rate to 0.3% from 0.4%, and lowering the deposit facility rate to -0.2% from -0.1%

ECB President Mario Draghi also announced that the ECB would begin buying bonds, specifically covered bonds and asset-backed securities.

All of these actions are intended to stimulate growth and boost inflation by keeping credit markets liquid and interest rates very low.

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