Federal Reserve lowers key interest rate by 0.5 percent

In order to sooth the repercussions of the US mortgage crisis on the US economy the Federal Reserve lowered the most important key interest rate by 0.5% to 4.75%. Another key interest rate was lowered by 0.5% to 5.25%. Back in August, this latter key interest rate had already been lowered by half a percentage point.

The US key interest rate had been unchanged for four years. The extent of yesterday´s adjustment took experts by surprise. However, this step by the Federal Reserve Bank showed its determination to protect the US economy from a major turndown, say most economic experts.

Immediately after the Fed´s move had been announced, US share prices rose at the stock exchanges. On the other hand, the dollar lost value against the Euro which hit a new record high. GERMAN