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 The decision means that the discount rate, the interest rate that the Fed charges to make direct loans to banks will be lowered to 5.75 percent, down from 6.25 percent.
The Fed did not change its target for the more important federal funds rate, which has remained at 5.25 percent for more than a year.
However, it has been infusing billions of dollars in money into the banking system over the past week to keep that rate from rising above the target level.
Many economists believe if the financial market crisis worsens the Fed will soon move to cut the federal funds rate as well.
[Associated Press; by Martin
Crutsinger]
Copyright 2007 The Associated Press. All rights reserved. This
material may not be published, broadcast, rewritten or
redistributed.
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