The Federal Reserve’s dramatic 75 basis point cut in the federal funds rate target yesterday sent Treasury and municipal yields lower, and left participants uncertain about future Fed monetary policy action.

The cut, which brought the target rate to 3.50% from 4.25%, marked the first monetary policy action taken by the Federal Open Market Committee between scheduled meetings since Sept. 17, 2001, the first trading day after the Sept. 11 terrorist attacks. It also marked the first 75 basis point lowering of the rate in more than 23 years, since October 1984.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.