The US Federal Reserve stepped up its campaign last night to head off recession with another half-point rate cut as part of an aggressive move to avert a downward economic spiral, analysts say.
Last night's cut in the federal funds rate to 3% came just eight days after an emergency cut of 0.75 percentage points in the face of a global stock market rout and concerns the world's biggest economy was sinking fast.
Analysts say the Fed, headed by Ben Bernanke, is acting more aggressively than any time in the past two decades.
The cuts in the federal funds rate, used for overnight interbank loans, can help lower a wide range of borrowing costs for consumers and businesses, and as such can help spur activity in an economy buffeted by the worst housing slump in decades which has spilled over to the financial sector.
As the Fed members met, the Commerce Department reported US economic growth slowed sharply to a 0.6% annual pace in the fourth quarter of 2007.
