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Economy

Fed cuts rate creating room for Asian central banks to act

Monetary easing begins to take hold as economies slow worldwide

A screen displays the U.S. Federal Reserve interest rates announcement as traders work on the floor of the New York Stock Exchange on July 31.   © Reuters

WASHINGTON/NEW YORK -- The U.S. Federal Reserve lowered its benchmark interest rate by 0.25 percentage point on Wednesday, marking its first rate cut in ten and a half years, as it sought to cushion the American economy from a global slowdown and trade tensions.

Fed Chairman Jerome Powell said the move was a "mid-cycle adjustment," rather than the beginning of a new phase of rate cuts, disappointing markets and inviting a frustrated tweet by U.S. President Donald Trump.

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