<html> <head> </head> <body> <center> <table cellpadding=2 cellspacing=0 width="100%"><tr><td width="1%"><a href=/><img src=http://us.yimg.com/i/dn/main4.gif border=0 width=250 height=31 alt="Yahoo! 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News </td> <td align=right bgcolor=9999cc> AP Headlines </td> </tr> </table> </td> </tr> </table> </center>  Tuesday November 17 2:27 PM ET <title>Federal Reserve Cuts Rates</title> <h2>Federal Reserve Cuts Rates</h2>  WASHINGTON (AP) - The Federal Reserve today reduced short-term interest rates by a quarter percentage point, acting for the third time in seven weeks to inoculate the U.S. economy against spillover from world financial turmoil.The central bank's monetary policy panel voted to move the benchmark federal funds rate, charged on overnight loans between banks, to 4.75 percent, from 5 percent. It announced the change at the conclusion of a closed-door meeting.Wall Street reacted immediately, turning up after being down 80 points minutes before the announcement.Rates on a variety of consumer and business loans, from credit cards to auto loans, were expected to fall in response. The largely symbolic discount rate, which the Federal Reserve charges on its own loans, also was reduced by a quarter point, 4.5 percent.``Although conditions in financial markets have settled down materially since mid-October, unusual strains remain,'' the central bank said in a statement. Signaling that its policy is now on hold, it added that with today's cut, ``financial conditions can reasonably be expected to be consistent with fostering sustained economic expansion while keeping inflationary pressures subdued.''The federal funds rate reduction was the third since Sept. 29, when the Fed cut rates for the first time in three years. The action was aimed at calming gyrating markets on Wall Street and preventing the U.S. economy from lapsing into recession in reaction to financial turmoil that struck first in Asia, spread to Russia and then threatened Latin America.The first cut, to the lowest level in four years, wasn't enough to calm Wall Street, and banks began pulling back from business lending. So, in a surprise move, the Fed cut rates again Oct. 15.  Earlier Stories <ul> <li><a href=http://dailynews.yahoo.com/headlines/ap/financial/story.html?s=v/ap/19981117/bs/fed_interest_rates_2.html>Next Interest-Rate Cut Uncertain</a> (November 17)</li> <li><a href=http://dailynews.yahoo.com/headlines/ap/financial/story.html?s=v/ap/19981117/bs/fed_interest_rates_1.html>Fed Interest-Rate Cuts Uncertain</a> (November 17)</li> </ul> <hr size=0> <center><form action=http://search.news.yahoo.com/search/news><input type=text size=25 name=p> <input type=submit value="Search News"><input type=hidden name=n value=10></form></center> <center><a href=http://dailynews.yahoo.com/headlines/ap/bs/story.html?s=v/ap/19981116/bs/index.html>Mon Nov 16</a> | <a href=http://dailynews.yahoo.com/headlines/ap/bs/story.html?s=v/ap/19981115/bs/index.html>Sun Nov 15</a> | <a href=http://dailynews.yahoo.com/headlines/ap/bs/story.html?s=v/ap/19981114/bs/index.html>Sat Nov 14</a> | <a href=http://dailynews.yahoo.com/headlines/ap/bs/story.html?s=v/ap/19981113/bs/index.html>Fri Nov 13</a> | <a href=http://dailynews.yahoo.com/headlines/ap/bs/story.html?s=v/ap/19981112/bs/index.html>Thu Nov 12</a> | <a href=http://dailynews.yahoo.com/headlines/ap/bs/story.html?s=v/ap/19981111/bs/index.html>Wed Nov 11</a> | <a href=http://dailynews.yahoo.com/headlines/ap/bs/story.html?s=v/ap/19981110/bs/index.html>Tue Nov 10</a> </center> <center><table border=0 cellspacing=0><tr bgcolor=ffffcc> <td align=center>  <A HREF=/headlines/>Index</a> </td> <td align=center>|</td> <td align=center>  <A HREF=/headlines/ts/>Top Stories</a> </td> <td align=center>|</td> <td align=center bgcolor=9999cc>  <A HREF=/headlines/bs/>Business</a> </td> <td align=center>|</td> <td align=center>  <A HREF=/headlines/tc/>Tech</a> </td> <td align=center>|</td> <td align=center>  <A HREF=/headlines/pl/>Politics</a> </td> <td align=center>|</td> <td align=center>  <A HREF=/headlines/wl/>World</a> </td> <td align=center>|</td> <td align=center>  <A HREF=/headlines/local/>Local</a> </td> <td align=center>|</td> <td align=center>  <A HREF=/headlines/en/>Entertainment</a> </td> <td align=center>|</td> <td align=center>  <A HREF=/headlines/sports/>Sports</a> </td> <td align=center>|</td> <td align=center>  <A HREF=/headlines/sc/>Science</a> </td> <td align=center>|</td> <td align=center>  <A HREF=/headlines/hl/>Health</a> </td> </tr></table></center> <hr size=0> <center> <a href="http://www.yahoo.com/info/faq/news/business_faq.html">Questions or Comments</a> <center>Copyright © 1998 The Associated Press. 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