Reviewing the Fed's Interest Rate Cuts

Are the interest rate cuts by Federal Reserve Board's Federal Open Market Committee (FOMC) producing the intended results? You be the judge.

Members of the FOMC for 2008

• Ben S. Bernanke, Board of Governors, Chairman
• Timothy F. Geithner, New York, Vice Chairman
• Richard W. Fisher, Dallas
• Donald L. Kohn, Board of Governors
• Randall S. Kroszner, Board of Governors
• Frederic S. Mishkin, Board of Governors
• Sandra Pianalto, Cleveland
• Charles I. Plosser, Philadelphia
• Gary H. Stern, Minneapolis
• Kevin M. Warsh, Board of Governors

Federal Reserve Chairman Ben Bernanke

List of FOMC interest rate adjustments in reverse order:

March 18, 2008 - Target federal funds rate reduced 75 basis points - from 3% to 2.25%.  FOMC Statement indicates weakened economic activity, financial markets under stress, and deepening of housing contraction on the one hand and increased inflation on the other.  Two FOMC members, Dallas Federal Reserve Bank President Richard Fisher and Philadelphia Federal Reserve Bank President Charles Plosser,  dissented from this action, arguing that 75 basis points was too aggressive.

Dallas Fed President Richard Fisher

Philadelphia Fed President Charles Plosser

January 30, 2008 - Target federal funds rate reduced  50 basis points from 3.5% to 3%.  Dallas Fed President cast the sole dissenting vote, preferring no reduction at this time.

January 22, 2008 - Target federal funds rate reduced in an unscheduled FOMC meeting 75 basis points from 4.25% to 3.5%.  William Poole voted against this reduction and Frederic Mishkin was absent.

December 11, 2007 - Target federal funds rate reduced 25 basis points from 4.5% to 4.25%.  Eric Rosengren  voted against this reduction, preferring to reduce the rate by 50 basis points.

October 31, 2007 - Target federal funds rate reduced 25 basis points from 4.75% to 4.5%.  Thomas Hoenig voted against this reduction, preferring no change at this time.

September 18, 2007 - Target federal funds rate reduced 50 basis points from 5.25% to 4.75%, pursuant to unanimous vote.

August 17, 2007 - Target federal funds rate unchanged from 5.25% pursuant to unanimous vote.  FOMC Statement says, "The Committee is monitoring the situation and is prepared to act as needed to mitigate the adverse effects on the economy arising from the disruptions in financial markets."

August 7, 2007 - Target federal funds rate unchanged from 5.25% pursuant to unanimous vote.

June 28, 2007 - Target federal funds rate unchanged from 5.25% pursuant to unanimous vote.

May 9, 2007 - Target federal funds rate unchanged from 5.25% pursuant to unanimous vote.

March 21, 2007 - Target federal funds rate unchanged from 5.25% pursuant to unanimous vote.

January 31, 2007 - Target federal funds rate unchanged from 5.25% pursuant to unanimous vote.

December 12, 2006 - Target federal funds rate unchanged from 5.25%.   Jeffrey Lacker voted against, preferring to raise rates 25 basis points.

October 25, 2006 - Target federal funds rate unchanged from 5.25%.  Jeffrey Lacker voted against, preferring to raise rates 25 basis points.

September 20, 2006 - Target federal funds rate unchanged from 5.25%.  Jeffrey Lacker voted against, preferring to raise rates 25 basis points.

August 8, 2006 - Target federal funds rate unchanged from 5.25%.  Jeffrey Lacker voted against, preferring to raise rates 25 basis points.

June 29, 2006 - Target federal funds rate raised 25 basis points from 5% to 5 1/4%, pursuant to unanimous vote.

May 10, 2006 - Target federal funds rate raised 25 basis points from 4.75% to 5%, pursuant to unanimous vote.

March 28, 2006 - Target federal funds rate raised 25 basis points from 4.5% to 4.75%, pursuant to unanimous vote.

January 31, 2006 - Target federal funds rate raised 25 basis points from 4.25% to 4.55%, pursuant to unanimous vote.

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(ag) March 26, 2008, in Economy/Interest Rates