US Federal Reserve policymakers opened a two-day meeting today which is widely expected to take unprecedented action to cut key rates to near zero in the latest effort to battle a crippling credit crunch.
Yet analysts say low rates have so far failed to spark economic activity and that the Fed - headed by Ben Bernanke - will likely look at a range of exceptional actions to get credit flowing again.
The Federal Open Market Committee (FOMC) is expected to cut its base lending rate from the current level of 1%, even if the move would be largely symbolic. The meeting starts today and is set to conclude tomorrow night after 7pm.
Some experts say there is a strong likelihood of a cut in the federal funds rate to as low as 0.25%, which would represent a sharp cut of three quarters of a percentage point.
Many analysts are anticipating a half a percentage point cut, which still would be an all-time low for the rate.
But the Fed's low rates have not yet filtered into many consumer and business loans, and it is likely to expand its arsenal of extraordinary actions to break the global credit crunch and avert a crippling deflationary spiral, analysts say.
