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8/19/11

Economy: More pain as Europe fails to kick the blues | Herald Sun

Fears of a global recession as the European debt crisis accelerates have sent share markets into a full retreat ahead of what may be weeks of intense volatility yesterday.

Investors again flooded out of the market yesterday, spooked by Europe's deepening woes and omens of another perilous credit crunch. Australia's benchmark index, the ASX 200, tumbled 3.5 per cent - its biggest single-day slide since "Freefall Friday" two weeks ago - to 4101 points.

It came after Wall Street markets tumbled and a sharp spike in US unemployment combined with an increase in inter-bank lending rates undermined investor sentiment.

The rise in inter-bank lending rates - a measure of banks' willingness to lend to each other - came after a bank tapped the European Central Bank for US dollars for the first time since February.

For more: More pain as Europe fails to kick the blues | Herald Sun

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