The Deaf Claque

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FOMC Cuts Federal Funds Rate by .25%

By Nathan Schmitt

Yesterday the Federal Open Market Commission cut the Federal Funds rate by a quarter of a percent in an effort to avoid adverse effects of a possible economic slump as a result of a variety of factors including disruptions in various financial markets. In their press release the FOMC said,

Economic growth was solid in the third quarter, and strains in financial markets have eased somewhat on balance. However, the pace of economic expansion will likely slow in the near term, partly reflecting the intensification of the housing correction. Today’s action, combined with the policy action taken in September, should help forestall some of the adverse effects on the broader economy that might otherwise arise from the disruptions in financial markets and promote moderate growth over time.” (1)

Economist Mark Thoma provides some context. Check out the comment section, there is a lot of extremely informative information there as well.


November 2, 2007 - Posted by | Economics, Nathan Schmitt | , , ,

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