Washington (AP) The White House is welcoming the cooperation among the fed and other countries' central banks to deal with the financial crisis. The presidential candidates are also praising the move.
The fed's action will cut borrowing costs almost immediately for U.S. bank customers whose home equity and other floating-rate loans are tied to the prime interest rate.
Fed Chairman Ben Bernanke and his colleagues ratcheted down their key rate by 0.5 percent, to 1.5 percent. The action revives the central bank's rate-cutting campaign which had been halted in June out of concerns that those low rates would worsen inflation.
Since then, however, economic and financial conditions have dangerously deterioriated, forcing the fed to reverse course.
The fact that the fed felt it could not wait until its regularly scheduled meeting late this month underscored the urgency of the situation.