Fed funds and discount rate cuts.
In our reader poll, 61% of respondents predicted a 25 basis point cut.
Too much? Too little? Goldilocks’ porridge? Leave your response in the comments section.
After the jump, the full release from the Fed.
October 31 Press Release [Federal Reserve]
For immediate release
The Federal Open Market Committee decided today to lower its target for the federal funds rate 25 basis points to 4-1/2 percent.
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.
Readings on core inflation have improved modestly this year, but recent increases in energy and commodity prices, among other factors, may put renewed upward pressure on inflation. In this context, the Committee judges that some inflation risks remain, and it will continue to monitor inflation developments carefully.
The Committee judges that, after this action, the upside risks to inflation roughly balance the downside risks to growth. The Committee will continue to assess the effects of financial and other developments on economic prospects and will act as needed to foster price stability and sustainable economic growth.
Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; Timothy F. Geithner, Vice Chairman; Charles L. Evans; Donald L. Kohn; Randall S. Kroszner;
Frederic S. Mishkin; William Poole; Eric S. Rosengren; and Kevin M. Warsh. Voting against was Thomas M. Hoenig, who preferred no change in the federal funds rate at this meeting.
In a related action, the Board of Governors unanimously approved a 25-basis-point decrease in the discount rate to 5 percent. In taking this action, the Board approved the requests submitted by the Boards of Directors of the Federal Reserve Banks of New York, Richmond, Atlanta, Chicago, St. Louis, and San Francisco.
Has the Canadian dollar hit $1.10 now?
I thought I heard the sound of a helicopter on the way to work this morning . . .
how many voted
I think we should call it the US dollarette now. Or the American peso.
Hey, we got a dissenter this time. Bernanke probably put him up to it so it would like someone on the FOMC has a backbone.
Anon 2:36, how bout the American Lira? Baht? Riingit?
So when canadians buy books now do they insist on paying in our money?
Lower interest rates, massive bank layoffs, hopefully the euro trash wont start buying park ave co-ops again. I just hate their smug faces as they walk out of the building with some brazillian babe at 9am
just right.
LOL…. American Peso….
“So when canadians buy books now do they insist on paying in our money? ”
I tried that, the little minimum wage weasels at Chapters stuck to their guns. Bastards.
I and everybody else I know has been on an online cross-border shopping rampage in the last month. It’s going to be a sorry Christmas for Canadian retail stores, I can tell you that, eh.
Why would you try to pay for a $50USD book with $50CAD?
CAD is still below par
maybe that will be my new green bar
No, 3:47, you’d try to buy with dollars, esp. since books (other stuff too but esp. books) tend to list a separate – higher – Canadian MSRP. So you’d want to pay the $50 us price in dollars rather than the $60 canadian price. And this must be one of those coffee table art books.
Disgraceful. No reason at all for the cut. It’s obvious that the Fed is on a leash and the masters got what they wanted. Every American with a savings account gets the middle finger and ridiculously high inflation.
The plunge to Third World status is well underway here. Even the freaking Mexican Peso spiked against the dollar today.
This is the legacy of the Bush America…borrow, borrow, borrow, spend, spend, spend, print, print, print, let the next generation worry about the consequences.