ECB lends $500bn to lower rates

The European Central Bank has allocated 348.67bn euros($502bn; £249bn) to banks at a below-market rate in a refinancing move to ease tightened credit markets.

It is one of five central banks that have injected billions in emergency cash into money markets.

The aim is to cut the cost of lending between retail and commercial banks, which has jumped in the past few weeks.

All banks with enough collateral, and which submitted bids of at least 4.21%, received funds from the ECB.

The ECB move - making the extra cash available over the next two weeks -will ease fears of a credit meltdown over the Christmas period, when banks need extra cash.

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