The Federal Reserve has decided to cut its benchmark interest rate by a-quarter of one percent. The move means that the Fed funds rate goes down to one percent, its lowest level since 1958.
Financial markets were divided whether the central bank would reduce by a-quarter or a more aggressive one-half of one percent.
The vote was eleven-to-one with Fed member Robert Parry dissenting.
He favored the larger reduction.
In its statement, the Fed says the economy has yet to show ustainable growth. It also notes that the liklihood of a ``fall in inflation,'' however minor, is greater than a pickup in pricing pressure.
The next meeting of the Federal Open Market Committee is scheduled for August 12th.