Federal rate cut: FTSE-100 surges, Dow Jones tumbles

The US Federal Reserve today cut the official key interest rate down to 1 percent in an act to fend off a critical recession. The Fed cut now matches the lowest levels for decades, and opening the doors for further cuts that the US have never seen.

The Fed cut by half a percent down to 1 percent, this cut came only weeks of the last rate cut which also for half a percent and was on October 8, this was in sequence with other leading central banks
The leaving the Federal Funds Rate at the lowest it’s been for four years.

After the announcement the feds read a depressing statement on the prospects that America is likely to face. Economists predict that the US official key interest rate will plunge to historic lows of 0.5 percent or even down to zero with the next few months.

The US key official data will be announced tomorrow and it’s expected to show that in the third quarter the US economy has shank.

Today the Dow Jones industrial average was extremely volatile and jumped up 2.7 percent following Tuesdays surge of 11 percent, but then closed down 74.16 points to 8,990.96

The FTSE-100 index in London jumped 8.1 percent or 316.2 points to close at 4,242.5. The FTSE-100

Source: timesonline