Fed opts for 75 basis-point cut

The Federal Open Market Committee (FOMC) on Wednesday 18 March voted to slash rates by three quarters of a percentage point to 2.25%.

Markets were expecting a full percentage point cut following the collapse of Bear Stearns, an investment bank, last week and the New York Stock Exchange fell on the news.

"Recent information indicates that the outlook for economic activity has weakened further," the FOMC said. "Growth in consumer spending has slowed and labour markets have softened. Financial ma