Figure 11-1 illustrates the Federal Reserve's response to the 2001 recession in the United States. How do central banks in other countries respond to recessions? Let us take a look at growth rates in the EU in the last few years and the reaction of the European Central Bank (ECB). Go to the ECB's Statistical Data Warehouse at https://sdw.ecb.europa.eu . Select "GDP in Prices of the Previous Year (Economic Growth)" and export the data. Then, click on "Monetary Operations" and then on "Key Interest Rates." Export the data on the level deposit facility interest rate. (Note: the ECB only provides dates for when the interest rate changes, so you will need to manipulate the data for it to fit with the GDP data.) Create a graph for the period 1999-2009, showing GDP growth rates and the interest rate. Was the EU in a recession in 2001? How did the ECB react to the economic slowdown in the early 2000s?
