Fed disappoints markets with 50 bp rate cut

The US Federal Reserve cut interest rates on Mar 20, 2001 by half a percentage point to 5.0%, continuing its aggressive effort to resuscitate the faltering economy but disappointing investors who had hoped for more.

Stock prices stumbled immediately after the announcement at 2.15 pm, rebounded almost as quickly, and then continued to gyrate as Wall Street sought to digest the mixed message conveyed by the central bank.

In explaining its decision, the Fed cited threats to the economy from declining

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