Global| Nov 06 2002Fed Cuts Funds Rate 50 Basis Points
by:Tom Moeller
|in:Economy in Brief
Summary
The Federal Reserve lowered the Federal Funds Target Rate more than expected to 1.25%, the lowest it's been since July 1961. The Board also lowered the discount rate 50 basis points to 0.75% The press release, which accompanied the [...]
The Federal Reserve lowered the Federal Funds Target Rate more than expected to 1.25%, the lowest it's been since July 1961. The Board also lowered the discount rate 50 basis points to 0.75%
The press release, which accompanied the Fed’s action, contained the following statement. "... incoming economic data have tended to confirm that greater uncertainty, in part attributable to heightened geopolitical risks, is currently inhibiting spending, production, and employment. Inflation and inflation expectations remain well contained."
The complete text of the Fed's latest press release can be viewed here.
On October 31, the Fed issued revised rules for the usage of the discount window. The revision "should eliminate the incentive for institutions to borrow for the purpose of exploiting the positive spread of money market rates over the discount rate." To view the Fed's press release on these changes, click here.
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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