fed cuts rates – PCBDaily

In what is likely to be the last rate cut – baring any more financial market blowups – in a while, The Fed cut the federal funds rate another quarter point Wednesday from 2.25% to 2%. The rate 5% as recently as September.

The statement “downside risks to growth remain” was removed from the Fed statement indicating to many analysts that we should start to see signs of recovery and that we are showing fewer signs of a downturn.

“They haven’t closed the door to further cuts, but they’ve shut it part way,” said Mark Zandi, chief economist for Moody’s Economy.com. “They’re saying they believe they’ve done enough.”

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As if January wasn’t bad enough with 22,000 job cuts, the February report showed job cuts of 63,000 marking two months in a row in declines. Most of the big cuts came from construction , manufacturing, retailing , financial services and a variety of professional and business services.

With a total of $160 billion short-term loans provided to banks since December, the Federal Reserve announced that it will increase the amount of loans it will make this month to $100 billion.

In response, Federal Reserve Chairman Ben Bernanke indicated that he is prepared to lower interest rates at their next meeting to help continue to give the economy a boost. Some economists are estimating a .75% cut.

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