Economy: May 18, 2001
In an effort to bolster the struggling economy, the Federal Reserve cut a key interest rate by a half point, the fifth reduction of the year. A decline in business investment in new equipment was highlighted as a primary reason for a slowdown in the economy, making the cut necessary, according to the Fed. The cut will be in the target for the federal funds rate, the interest banks charge each other on overnight loans. The Fed said its chief concern remains the threat of the economy stalling and falling into a recession.
