The European Central Bank (ECB) has cut its key interest rate to 1.5% from 2.0%, the lowest since it started setting euro rates in January 1999.
It followed a cut in UK rates by the Bank of England. US and Japanese rates are, in effect, already at zero.
At a news conference, ECB president Jean-Claude Trichet slashed his forecasts for eurozone growth.
The ECB is now predicting GDP this year in the 16-nation bloc will shrink by between 2.2% and 3.2%.
Its last prediction, made in December, was that growth would be between no change and a fall of 1% in 2009.
For 2010 it was predicting growth of between 0.5% and 1.5%. It is now forecasting growth of between 0.7% and minus 0.7%.
The revisions reflect Mr Trichet's view that the global economy has "weakened substantially in recent months" but that it will "gradually recover" in 2010.
But there were no new measures announced to help stimulate the eurozone economy, with Mr Trichet stressing that he was already using various "non-standard measures" and saying that the ECB's rate-setters were considering various others.
Slowing growth was confirmed by revised economic growth figures issued earlier on Thursday.
GDP for the last three months of 2008 was down 1.3% from the same quarter of the previous year, worse than the initial estimate of 1.2%.
The figure for the previous quarter was left unchanged at a 1.5% fall.
Thursday's decision was the ECB's fifth rate cut since October 2008, which has brought eurozone rates down from 4.25%.
Mr Trichet said that interest rates could still fall further from their current level, although he pointed out that they are already at a very low level.
He also said that inflation would stay below the ECB's target of below, but close to, 2%.
"Overall inflation rates have decreased significantly and are now expected to remain well below 2% over 2009 and 2010," he said.