Fed cuts rates -- again
The Federal Reserve cut a key short-term interest rate from 3.5 percent to 3 percent this afternoon, the second reduction in just over a week. Its federal funds rate determines what banks charge each other for overnight loans, and therefore has an impact on a variety of interest rates that consumers pay and earn.
The Fed said in its statement that "downside risks to growth remain," generally a code phrase for "look for more rate drops in the future."
You can read the full statement HERE. The Fed also said:
Financial markets remain under considerable stress, and credit has tightened further for some businesses and households. Moreover, recent information indicates a deepening of the housing contraction as well as some softening in labor markets.
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Comments
Bear Stearns is already calling for ANOTHER full point cut at the next Fed meeting. Fed cuts are like heroin to brokers...just wait till they have to go cold turkey.
Posted by: Kevin | January 30, 2008 8:51 PM