Fed cuts fund rate by 50 bps to 3%

2008-01-31 08:35:56 Source : CNBC-TV18


The Fed has cut federal funds rate by 50 bps to 3%, reports CNBC-TV18. Fed officials said they see a deepening in housing contraction and soft labour markets. According to them, financial markets are still under considerable stress and the downside risks to growth remain. They added that credit has tightened for businesses, households and that cumulative policy action should moderate inflation, promote growth, ease risks.



Fed treasury secretary Paulson said that monetary policy not answer to everything. Meanwhile, US President George Bush said the government can help the economy stay strong and that the US economy is slowing but resilient.