Fed cut main lending rate to 2.25 percent

March 18 — The Federal Reserve cut its main lending rate by three-quarters of a percentage point to 2.25 percent as officials try to recover the economy and restore faith in the U.S and global market. The credit problem cause banks reluctant to lend to each other. Due to worries of inflation, the Fed are making less aggressive action. Their action shows that they are reacting to this economy problem. But will the Fed action is enough? Mortgage lending will tumble to an eight-year low this year and house prices will continue to decline, according to the Mortgage Bankers Association.