U.S.: What Greenspan Saw In The Data

Will his aggressive action confine the damage to manufacturing?

What a way to ring in the new year. Coming after another one-day plunge in the Nasdaq, a drop in consumer confidence, and a purchasing managers' report that confirmed the manufacturing sector is in recession, the Federal Reserve decided it could wait no longer to see how the 2001 economy would play out. And so, in a stunning move on Jan. 3, policymakers cut short-term interest rates. More important to the outlook, the Fed suggested more cuts could be on the way.

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