U.S. Chamber Welcomes Continued Easing by Fed

WASHINGTON, D.C. - The United States Chamber of Commerce welcomed the Federal Reserve Board's decision to lower the federal funds rate by an additional 25 basis points to 3.50 percent, the lowest since 1994. The Fed has cut its target rate by 3 percentage points since the beginning of this year.

"With inflation in check, the Fed continues to battle a sluggish economy," said Martin A. Regalia, Chamber vice president and chief economist. "Thus far those cuts have helped stave off a recession but have yet to trigger a rebound.

"With consumers continuing to spend, housing markets remaining strong, and businesses drawing down inventories, the economy should be poised for a turn around by the end of the year," Regalia said. "These combined rate cuts are sure to make borrowing easier for both consumers and small businesses.

"Combined with this year's tax rebates, this most recent rate cut is an insurance policy against further weakening in the economy," Regalia noted.

"As important as the rate cut itself, the Fed's decision to maintain its economic growth bias is a clear expression of its willingness to cut rates further if necessary to get the economy moving," said Regalia.

The U.S. Chamber of Commerce is the world's largest business federation representing more than three million businesses and organizations of every size, sector and region.

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