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May 17, 2008 12:38:54 AM CDT

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Fed Ponders Pause in Rate Cuts—After 1 More  

Posted Apr 24, 08 10:05 AM CDT in Business    Most Covered

(newser) – The Federal Reserve may be ready to cool its torrid rate-cutting after a likely .25% percentage point cut at its meeting next week, the Wall Street Journal reports. Futures markets are betting Chairman Ben Bernanke is unlikely to rest just yet, with little change in the month-to-month economic picture, but will pause after that to assess the cuts' effect and avoid stoking inflation.

Too deep a cut could provide marginal economic relief while leaving the central bank little wiggle room if the recession worsens. "They can't give the all-clear signal, but they can say there's a presumption in favor of a pause," says a former Fed governor. A cut next week would be the seventh in eight months, from 5.25% to 2%.

Source Wall Street Journal

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Fed Ponders Pause in Rate Cuts—After 1 More
Federal Reserve Chairman Ben Bernanke delivers the Fed's Monetary Policy Report, on Capitol hill in Washington.   (AP Photo/Dennis Cook, File)
Fed Ponders Pause in Rate Cuts—After 1 More
Federal Reserve Chairman Ben Bernanke listens to a presentation by the Jump$tart Coalition for Personal Financial Literacy.   (AP Photo/J. Scott Applewhite)
Fed Ponders Pause in Rate Cuts—After 1 More
Federal Reserve Chairman Ben Bernanke testifies on Capitol Hill in Washington.   (AP Photo)
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Federal Reserve  • recession  • Ben Bernanke  • inflation  • subprime crisis  • interest rate cut


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