The Federal Reserve announced on Wednesday reduces the interest rate 50 basic points to 1%

U.S. Federal Reserve decided Wednesday to cut the benchmark interest rate by 50 basis points to 1%, in line with economists previously expected, the aim is to prevent the U.S. economy after World War II into the most serious recession. Prior to that, the Federal Reserve to cut interest rates twice this year by 50 basis points, respectively in the January 30 and October 8. U.S. Federal Open Market Committee (FOMC) statement released today in Washington, said: "The economic growth is still facing the risk down. Since the Federal Reserve's recent policy initiatives, including today's decision to cut interest rates, the major central bank to cut interest rates together, the mobility of exceptional measures As well as to strengthen the financial system and measures taken should be played in the long term to improve credit conditions and the resumption of moderate economic growth. " The world's major central banks are trying to restore credit markets to curb global recession situation, consumer spending fell and banks reluctant to loan the momentum. In today's decision to cut interest rates before the Federal Reserve, European Central Bank and four other central banks on October 8 decided to combine forces to cut interest rates. Today, China and Norway, the central bank also decided to cut interest rates. Last September in the policy-making meeting, the director of the Federal Reserve to inflation known as the "major worry", but since then commodity prices and weak consumer spending to decline in the level of inflation. Of these, crude oil futures prices and record high in July has been down compared to 54%. U.S. Department of Commerce is scheduled to be published tomorrow in the third quarter of the U.S. GDP report. According to the economists on average expected the report will show the American quarter of negative GDP growth 0.5 percent, since 2001, the highest since the recession of negative growth. Economists also expect the fourth quarter of the United States will continue to be negative GDP growth. Economic research institutes Decision Economics Allen Sinai, chief economist (Allen Sinai), said: "The U.S. economy is likely to enter the post-World War II the most serious recession, and will maintain for a long time." Fed members agreed to cut interest rates today, will also cut the discount rate by 50 basis points to 1.25 percent. Over the past 13 months, the Federal Reserve would have been the benchmark interest rate from 5.25 percent level dropped, and set up a mechanism of the six lenders, the financial system to the injection of more than 1 trillion dollars. Nevertheless, banks are reluctant to loan to the industry, S & P 500's decline so far this year close to 36%. The former director of the Federal Reserve, is currently a professor at Columbia University's Frederic Mishkin (Frederic Mishkin), said: "In the U.S. Federal Reserve to provide liquidity to the market's been very aggressive on the issue." However, in October U.S. consumer confidence continued to drop to record low in September durable goods orders for the second consecutive month reduction. Other reports also showed that 20 U.S. metropolitan areas of housing prices in August fell 16.6 percent year-on-year. Data show that since early last year, the world's major financial institutions have suffered 680,000,000,000 U.S. dollars of home loans, mortgage-backed securities and asset write-down of capital and credit losses.