Projo Biz Blog

The Federal Reserve made a surprise, emergency move this morning to cut a benchmark, short-term lending rate to 3.5 percent from 4.25 percent. The Fed, which was not scheduled to meet again until Jan. 29 and 30, responded to a slowing economy and tumbling stock markets worldwide.

The Fed said, in a statement, "While strains in short-term funding markets have eased somewhat, broader financial market conditions have continued to deteriorate."

In a related move, the Fed lowered the so-called discount rate on direct loans to commercial banks by .75 percent to 4 percent.

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