Fed rate cuts successful in stabilising economy

Uncertainty remains over whether the domestic rate cuts will have succeeded in pulling the US back from the brink of recession. The third and fourth quarters of 2001 were the first successive quarters of negative GDP growth for some time. However, Steve Arnott, US fund manager at Threadneedle, believes this year will eventually see a return to positive growth, albeit at a sluggish pace. 'The rate cut programme was stepped up following 11 September in order to maintain confidence in the financial system,' he says. 'It appears to have worked as a lot of leading indicators show economi...