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Bernanke Opens Door to Steep Cuts

Posted by marketnews on January 10th, 2008

By BRIAN BLACKSTONE
January 10, 2008 12:43 p.m.

Federal Reserve Chairman Ben Bernanke opened the door to aggressive interest-rate reductions, saying downside risks to the economy "have become more pronounced."

His remarks support Wall Street's expectation that officials will lower the fed funds rate by as much as one-half percentage point when they meet at the end of this month.

U.S. Economic data in the first week of the New Year spelled T-R-O-U-B-L-E for both the US economy and the stock market. The December ISM report on January 2nd showed the manufacturing sector joining the housing and financial sectors already in recessionary territory.

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