| For immediate release |
|
Completing action initiated yesterday, the Board of Governors today approved a discount rate of 5-1/2 percent, acting on requests submitted by the Boards of Directors of all twelve Reserve Banks. Yesterday, in conjunction with the Federal Open Market Committee's decision to lower the federal funds rate target by 50 basis points, the Board approved pending requests from Federal Reserve Banks to reduce the discount rate by 25 basis points, to 5-3/4 percent, and said that it would approve a further 25 basis point reduction once the Reserve Banks submitted requests. The discount rate is the rate charged depository institutions when they borrow short-term adjustment credit from their district Federal Reserve Banks. The rate change is effective immediately except in the St. Louis district, where the rate becomes effective as of Friday, January 5, 2001. |