“The U.S. Federal Reserve on Tuesday slashed U.S. interest rates (the overnight rate at which banks lend each other) by a hefty three-quarters of a percentage point, the biggest rate cut in more than 23 years, in an emergency bid to lend support to a U.S. economy some fear is on the verge of recession… The last time there was a rate cut of at least three-quarters of a point was in October 1984.” – Reuters
The interest rate cut has steadied the global markets which were previously in a free fall.
As a result of Fed’s rate cut, the CBOE Market Volatility Index (VIX) (so-called stock market fear gauge) spiked to its highest level seen since the end of the previous bear market before paring gains, as the major stock market indexes bounced off earlier lows.