Fed Trims Rate to 2%

Markets expect cut to be body's last for some time
By Will McCahill,  Newser Staff
Posted Apr 30, 2008 1:31 PM CDT
The Federal Reserve cut interest rates today.   (AP Photo/J. Scott Applewhite)
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(Newser) – As expected, the Federal Reserve cut a key US interest rate today, the Wall Street Journal reports, trimming its overnight rate a quarter-point to 2%. Seven consecutive cuts have the rate down from 5.25% in September as the Fed attempts to keep the economy from stalling under credit woes. "Economic activity remains weak," today's statement says, and markets "remain under considerable stress."

However, the Fed is likely to ease off on further trims for the near future, the Journal notes. Though the moves aim to put more money into the economy, they also raise inflationary pressures. The Fed says it will continue to act as needed, but dropped reference to doing so in a "timely" manner, as was customary in recent statements.