04/01/2012 World Business Report

We will keep you updated when we get that final result.

For the moment, we go to World This is World Business Report. The

headlines: Despite the system, inflation interest rates could be

And after any collapse in 2009, the US car market has bounced back.

2012 is said to be another year of note in -- low interest rates with

the ECB likely to cut the cost of borrowing further. That is despite

inflation being well above target. It will confirmed later this

morning what the inflation figures are. Our Business Report and looks

at the global picture for interest rates.

In Rome, there is plenty of produce The fact that food prices are

rising steadily does not help. At the moment, central banks are

weighing up a very different priority. Here in London, the Bank

of England has record low interest rates of 0.5% for nearly three

years. This week, India's central bank said it too was considering

cutting, rather than raising, rates. Now, the ECB appears t appears ting

a similar approach. Since November, the ECB's boss has

overseen rate cut from 1.5% to 1.25 %. And in December, down to 1%.

Markets now expect a further reduction to a record low of 0.75 %.

Who cares about inflation, when you have a recession. If we have a

recession, with particularly weak growth for a prolonged period, it

will bring inflation lower. So the focus has shifted from being

worried about inflation risks to a worry about deflation and about

recession. One other advantage of cutting rates is that it puts

downward pressure on the euro, which in turn makes it more

competitive. Unless of course everybody else cut rates as well,

in which case nobody wins. After hitting a 30-year low into

Dundon nine, US car sales have had a second straight year of growth in

t of easier credit and pent up demand

for cars and trucks created by the recession. On Wednesday, the

monthly sales were reported. They are expecting a gain of around 8%

from the year before. This woman runs two dealerships in

New Jersey. She sells around 2000 new vehicles every year. She says

customers have been returning to her show rooms in droves. The sales

are up 30%. The economy is on its way back. I believe we had a while

across the board did credit issues. I am seeing a freeing up of that. -

- had a lull. Credit to buy a car is improving now. And consumers

want to replace all the cars that were pressed into service longer