Fed Cuts Rate 0.75%

The Federal Reserve, responding to an international stock sell-off and fears about a possible United States recession, cut its benchmark interest rate by three-quarters of a percentage point on Tuesday, an aggressive move that came ahead of a regularly scheduled meeting of the central bank.

The surprise move, unusual in both its scale and its timing, underscored the severity of the current strains facing the economy. And it bolstered world markets that had opened the week with a sell-off. European stocks turned upward on the news, and Wall Street averted the deep losses that had been anticipated overnight.

“It’s a once-in-a-generation event,” said Mark Zandi, chief economist at Moody’s Economy.com. In recent years, the Fed has rarely acted between scheduled meetings of the committee, and almost always in increments of one-quarter or one-half point. It was the biggest short-term cut since October 1984.   Read More…