Fed cuts target for key rate to record low

The Federal Reserve has cut its target for a key interest rate to the lowest level on record and pledged to use “all available tools” to combat a severe financial crisis and prolonged recession.
   
The central bank says it reduced the federal funds rate, the interest that banks charge each other, to a range of zero to 0.25 percent. That is down from the 1 percent target rate in effect since the last meeting in October.
   
Federal Reserve Chairman Ben Bernanke and his colleagues also pledged to use “all available tools” as they struggle to contain a financial crisis that is the worst since the 1930s and a recession that is already the longest in a quarter-century.
   
Wall Street is applauding the unusual move from the Federal Reserve.
   
Stocks are extending their gains following the central bank’s decision.