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Article: A Look at Federal Funds Rate
- Article from:
- AP Online
- Article date:
- May 22, 2003
- Author:
CopyrightThis material is published under license from the Associated Press. All inquiries regarding rights should be directed to the Associated Press. (Hide copyright information)
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Dateline: WASHINGTON
Running out of room to lower a key interest rate, the Federal Reserve
is looking for other options to get the economy moving again.
Fed Chairman Alan Greenspan made clear at a congressional hearing
Wednesday that the central bank was not running out of "monetary ammunition"
to prevent a destabilizing drop in prices.
The Fed's main tool is the federal funds rate, which it can raise
or lower to bring about changes in consumer and business spending.
Here, in question and answer form, is a look at the federal funds
rate and other tools at the Fed's disposal:
Q: What is the federal funds rate?
A: The federal funds rate, the Fed's main tool ...