Contrasting monetary policy moves from the Bank of England (BoE) and European Central Bank (ECB).

The BoE stunned the markets with a 1.5% rate cut, taking its benchmark rate to 3.0%, the lowest in over half a century. The ECB, meanwhile, met expectations with a 50 basis-point cut. The Eurozone’s policy rate now stands at 3.25%.

This from Bloomberg:

The Bank of England is working with the government to limit the fallout from what it calls the worst global banking crisis in almost a century. Prime Minister Gordon Brown was forced last month to broker a takeover of HBOS Plc and Bank of England figures show financial institutions in the U.S. and Europe have already suffered $2.8 trillion in securities losses from the crisis.

“They’re admitting that this recession is going to be very painful and have a huge impact on inflation,” said George Buckley, an economist at Deutsche Bank AG in London. “This is obviously a lot of help but it remains to be seen how much gets passed through.”

UK and European stock markets bounced initially on the news. But the mixed responses and concerns over the global economic outlook kept key benchmarks deep in the red.

US futures point to a sharply lower opening. The Dow is currently down around 1.5%.

Read why Bill Bonner thinks “foolhardy” government measures to prevent this crisis will only make it deeper and more painful.