The board has unanimously agreed to a 50 bps cut. The Federal Reserve has cut the Fed fund rate from 5.25% to 4.75%. Now watch the markets go!
The Federal Open Market Committee said that economic growth was moderate during the first half of the year. The credit condition has the potential to worsen the housing correction and to restrain economic growth in the future. The action intends to forestall some of the broader economy effects arising from troubled financial markets and to promote moderate growth overtime. Core inflation has improved modestly this year but the FOMC still feels there's a moderate inflation risk. The committee will continue to monitor and act accordingly in the future.
The Dow industrials was up over 200 points but now about 170 points up. Definitely a surprise to the upside. The Nasdaq composite and the S&P 500 are up even more.
The Fed discount rate was also cut by half a percentage point.
Flash: 50 basis point rate cut
Posted Sep 18th 2007 2:16PM by Melly Alazraki
Filed under: Market matters, Federal Reserve
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Reader Comments (Page 1 of 1)
9-18-2007 @ 3:08PM
John said...
Yeah this helped the investor. Now will they turn around and take less than 25%/year so we can have wage hikes to at least keep up with inflation so we can afford houses and cars even if the rate was a measly half point higher?