FEDS CUT KEY RATE BY THREE-QUARTERS OF A POINT

FEDS CUT KEY RATE BY THREE-QUARTERS OF A POINT

The Federal Open Market Committee voted 8-2 to cut the fed funds rate from 3% to 2.25%, its lowest level since December 2004. The Feds also signaled more reductions are likely to stimulate the economy.

In a statement released in conjunction with the rate cut, the Federal Reserve Bank said, “Recent information indicates that the outlook for economic activity has weakened further. Financial markets remain under considerable stress, and the tightening of the credit conditions and the deepening of the housing contraction are likely to weigh on economic growth over the next few quarters.”