Fed cuts interest rates to 3%

The cut comes only a week after the Fed made an emergency decision to drop rates by 75 basis points and it signaled further reductions could be a possibility. Rates are now at the lowest level since May 2005. It said the cut would “mitigate the risks to economic activity” although “downside risks to growth remain”. The 50 basis point cut was approved by a nine to one margin and the Fed also unanimously approved a 50 basis point cut in the rate at which it lends to banks. Despite the news, the Dow Jones closed down 37.47 at 12442.8 yesterday. IFAonline