Europe has moved further along the road towards a recession than the US. The economic data of the past two weeks make that conclusion hard to avoid and Jean-Claude Trichet made no great attempt to deny it in his press conference on Thursday.

The governor of the European Central Bank admitted that the data “point to a weakening of real GDP growth in mid-2008” and said directly that the bank no longer has a bias towards raising rates. He made obligatory commitments to fight inflation but the market drew the necessary conclusions; last month’s rate rise from the ECB was a “one-off” warning shot and there will be no more.