Fed Cuts Discount Rate to 3.5%

After deciding to cut the Fed Funds Rate to 3.0% on Wednesday, the Federal Reserve bank has slashed the discount rate to 3.5%. While the Fed Funds Rate determines the rate that banks can charge one another for borrowing money, the discount rate controls what the banks get charged after directly borrowing from the Fed.

Fed’s Press Release:

http://www.federalreserve.gov/newsevents/press/monetary/20080131a.htm

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