Increasing recession worries have hammered European shares which closed down five percent on Wednesday.
The value of the pound tumbled after the governor of the Bank of England said Britain is probably in a recession.
Oil and metals prices slumped on the basis that a global economic slowdown will mean less demand.
And investors are betting the US will recover first. Tom Hougaard, analyst with trading house City Index, said interest rates are key now: “The US has already slashed their rates earlier on in 2008 and they are somewhat limited in their capability of further rate cuts. By that prognosis most market commentators and observers believe that US will most probably be the first country to come out of this recession, of this global recession, that we are in.”
The euro is down against the US dollar on speculation that European central banks will cut interest rates.