Fed Cuts Interest Rate by a-Quarter

By: AP Email
By: AP Email

Washington (AP) The Federal Reserve is still giving some medicine to the economy, only in a smaller dose this time.

In announcing its interest rate cut, the central bank ordered a reduction of a-quarter point. That's less aggressive than what was seen earlier this year.

The move takes the benchmark federal funds rate down to 2 percent, its lowest level since late 2004. It is the seventh reduction by the fed since it began easing last September in response to the credit crunch and housing slump.

In turn, banks reduce their prime lending rates, used as the basis for consumer and business loans.

Many analysts believe the latest move could be it for rate cuts unless the economy falters more than expected.

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