Federal Reserve policy-makers began meeting on Tuesday against the backdrop of a still-plummeting U.S. housing market that is sapping consumer optimism and may require more interest-rate tonic.
The Fed can now turn to pursuing a "risk management" interest rate policy that insures against a steep economic downturn.
With global economic growth waning and a credit crunch threatening, finance chiefs from rich nations were gathering on Friday to mull how to control strains in financial markets and keep expansion going.
Wells Fargo & Co and other U.S. regional banks on Tuesday reported disappointing third-quarter results, hurt by mounting losses from mortgages and other loans as the U.S. housing market slumps.Earnings fell short of analysts' forecasts at Wells Fargo, Regions Financial Corp and KeyCorp U.S. Bancorp's results topped forecasts, though profit fell. All four banks said loan losses rose.
U.S. financial markets are healthier after a turbulent summer, but a full recovery will take time and the Federal Reserve will act as needed to support market stability as well as noninflationary growth, Fed Chairman Ben Bernanke said on Monday.
The audacious rise in the Dow industrials to a record will do little to prevent the millions of new "For Sale" signs likely to dot U.S. lawns soon.
Bill Gross, manager of the world's largest bond fund, on Monday said that the subprime mortgage crisis will dominate Federal Reserve policy over the next several years and believes short-term U.S. interest rates could fall to 3-3/4 percent over the next six to 12 months.
New orders for costly U.S.-made manufactured goods dropped at the sharpest rate in seven months during August, according to a government report which added to signs growth was slowing in the third quarter.
Treasuries ended the week on a more positive note on Friday, a turnaround following a selloff which began on Tuesday when the U.S. Federal Reserve cut its benchmark interest rate to give a boost to the economy, setting off some inflation concerns.
A steep cut in U.S. interest rates should have eased debt worries but inflation in oil and food prices is a concern.
Federal Reserve Chairman Ben Bernanke said on Thursday the central bank slashed interest rates this week to brace the U.S. economy against damage from financial turmoil but warned the outlook remains uncertain.
Federal Reserve Chairman Ben Bernanke and Treasury Secretary Henry Paulson told Congress on Thursday they are open to letting Fannie Mae and Freddie Mac buy more troubled home loans if the companies control risk and agree to tougher oversight. Both had previously resisted letting the two mortgage finance companies expand their presence in the mortgage market
Stocks were little changed on Thursday as a weak outlook from economic bellwether FedEx and sharply lower profit from investment bank Bear Stearns helped stall a rally that followed this week's aggressive interest rate cut.
The dollar broke above $1.40 per euro for the first time on Thursday, weakened by a hefty U.S. interest rate cut this week and expectations of further cuts in benchmark rates.
Federal Reserve Chairman Ben Bernanke warned Congress on Thursday that raising the ceiling on the size of loans that mortgage finance enterprises Fannie Mae and Freddie Mac can buy could undermine market discipline.
Benchmark stock indexes looked likely to open lower on Thursday, index futures showed, and analysts said earnings from two top banks and remarks by Fed Chairman Ben Bernanke would be in focus.
Gold firmed on Thursday and held within sight of its 16-month high of $726 an ounce, but the metal was seen trading in a tight range before challenging its highest level in nearly three decades.
The dollar sank to fresh record lows beyond $1.40 per euro on Thursday, weighed down by a hefty U.S. interest rate cut earlier this week and expectations of more moves to come.
The Federal Reserve's move to slash interest rates by a half-percentage point signals that Chairman Ben Bernanke, fearing broad damage from recent market turmoil, preferred to risk doing too much rather than too little, the Wall Street Journal reported in its online edition.
Criticism of Greenspan's policies rose as his memoir was released but observers say he will endure as one of the best central bankers.
The Federal Reserve is expected to chart a new course on Tuesday and cut benchmark interest rates for the first time since mid-2003 to protect the economy from a housing downturn and jittery credit markets.
A long period of stasis in Federal Reserve monetary policy looks certain to end on Tuesday with a U.S. interest-rate cut, leaving the question of how much further rates may drop and how fast.
