The Federal Reserve's interest rate cut Tuesday was its first such move between meetings since 2008. Here are some other times it's taken emergency action
In first such move since the Great Recession, the Fed cuts the benchmark interest rate by half a point to offset the economic effects of coronavirus.“The coronavirus poses evolving risks to economic activity,” the Fed said in a statement. “In light of these risks and in support of achieving its maximum employment and price stability goals, the Federal Open Market Committee decided today to lower the target range for the federal funds rate by 1/2 percentage point.
Policymakers said in a statement that they acted “in view of a weakening of the economic outlook and increasing downside risks to growth.”The Fed lowered its discount rate — the rate it charges banks — by 50 basis points to 5.75% as the subprime-mortgage collapse roiled financial markets. “These actions were taken in light of further weakening of sales and production, and in the context of lower consumer confidence, tight conditions in some segments of financial markets, and high energy prices sapping household and business purchasing power,” officials said.As Russia’s financial crisis and the collapse of the hedge fund Long Term Capital Management threatened a credit crunch, the Fed cut its rate by 25 basis points to 5%.
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