It is the biggest rate cut in more than twenty years.
After an emergency meeting the Federal Reserve slashed two key interest rates by three fourths of a percent.
The fed says the rates were slashed to stimulate the economy as many fear a recession looms on the horizon.
The federal funds rate was cut from four point two five percent to three point five percent. That rate affects how much you pay on your credit card debt, home equity lines of credit, and car loans.
The fed also lowered its discount rate from four point seven five percent to four percent. That rate is what it costs banks to directly borrow from the central bank.
So what does this mean for you? Lower interest rates for loan seekers.
If you were hoping to get a home loan or a car loan but found interest rates too high, you may now be able to borrow money at a lower rate and put money back into the economy.