Federal Reserve Cuts Interest Rate by Half a Percentage Point

The Federal Reserve cut a key interest rate by one half of a percentage point today in an attempt to revive the struggling economy.   The Fed said that the reduced ability for households and businesses to obtain credit was one of its reasons for reducing the interest rate in a statement explaining the decrease.

The Federal Reserve rate decrease should cut the prime rate for commercial banks by the same one half percent. Many loans for businesses and consumers are tied to the prime rate, so auto loan rates should fall too, according to MSNBC.