ECB reacts to recession threat by keeping interest rates low

Eurozone banks also promised extra liquidity as ECB follows in US Fed's dovish footsteps

The European Central Bank has reacted to the threat of recession across the eurozone with a promise to keep interest rates at historically low levels for at least the rest of the year.

Highlighting the dramatic effect of Donald Trump's trade war with China on Europe's manufacturing industry, the ECB president, Mario Draghi, said he would also offer cheap loans to the eurozone's troubled banks, which need to roll over billions of euros of funding over the next two years.

Related: ECB unveils measures to revive eurozone as it cuts growth forecasts - as it happened