Fed Takes Steps to Protect Financial Institutions
The U.S. Federal Reserve cut to its lending rate to financial institutions to 3.25 percent from 3.50 percent, effective immediately, and created another lending facility for big investment banks to secure short-term loans.
The moves were part of a series of new steps to help provide relief to a spreading credit crisis that threatens to plunge the U.S. economy into recession.
The steps are "designed to bolster market liquidity and promote orderly market functioning," the Fed said in a statement. "Liquid well-functioning markets are essential for the promotion of economic growth."
The new lending facility will be available to financial institutions on Monday.
Published on March 17, 2008
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