US Federal Reserve policymakers resumed meeting today amid widespread anticipation of a second sharp cut in interest rates.
A Fed spokesperson said the policy setting Federal Open Market Committee (FOMC) began meeting and is expected at about 7.15 p.m. this evening.
Most analysts were predicting another half-percentage-point slash to 5.5 per cent in the key federal funds rate that banks charge one another for overnight loans, added to a matching shock reduction announced on January 3rd.
Waning consumer confidence and a declining manufacturing sector, added to testimony before Congress from Fed chairman Mr Alan Greenspan last week that growth has slowed to near zero, virtually guaranteed another rate cut, analysts said.
Just before starting today's session, FOMC members saw figures from the US Commerce Department showing that overall economic growth, measured by Gross Domestic Product, slowed to a 1.4 per cent rate in the final quarter of 2000 the weakest advance since 1995.
Reuters