Is the ECB Rates Reduction Enough?

Recently the ECB reduced the Interest rate (Interest rate on the main refinancing operations that provide the bulk of liquidity to the banking system) from 1.5% to 1.25%. Even if the economist had forecasted a 'to 1%', the market reaction in the (Eur/Usd) was almost flat, hence the traders were expecting the smooth movement from the ECB.

Trichet, in the press conference, has also announced that there is a slight possibility for a further rate reduction in the near future. So why don’t they mimic the FED and be more decisive in the rate reduction?

Accordingly to the IS/LM model (Investment Saving / Money supply) a reduction in I, the interest rate, is aimed to an increase in Y, the given economy output. That’s the reason why the Central Banks in an economy downturn are reducing the rates. In this particular economic environment, Trichet should have cut deeper the rates. But the European’s soft approach has prevailed and the reduction process is going very smoothly.