US interest rates cut to 2% in the seventh cut since September
1 May 2008
The Federal Reserve lowered interest rates by a modest quarter percentage point on Wednesday, as expected, and hinted the move could be the last in a series meant to buffer the economy from a credit crunch and housing downturn.
The Fed, however, kept its options open and nodded to ongoing financial market stress, tight credit and the deepening housing contraction, leaving some market participants guessing rates could still move lower.
The central bank's action takes the bellwether federal funds rate target, which banks charge each other for overnight loans, to 2 percent -- the lowest since December 2004. It was the seventh cut in a campaign that has brought the key lending rate down by 3.25 percentage points since mid-September.
The Fed also on Wednesday cut the discount rate it charges on direct loans to banks by a matching quarter point.