The Federal Reserve has taken interest rates down a-half a point, catching many market watchers off-guard.
The central bank was expected to trim rates for the first time since last December. But Wall Street figured a-quarter point rate cut was in the cards.
In its statement, the Fed says the reduction should be "helpful as the economy works its way through this current soft spot."
The target for the federal funds rate moves down to one and a-quarter percent. It is the rate banks charge each other on overnight loans.
The Fed cites "greater uncertainty, in part attributable to heightened geopolitical risks." The Fed says that uncertainty is hurting spending, production and employment.
The Federal Open Market Committee was unanimous in the decision.
The Fed's interest rate cut is likely to spur more real estate business. Diane Saatchi, president of Dayton-Halstead Real Estate on Long Island, says the immediate effect may be little. But she says in the weeks ahead, mortgage rates probably will come down even more.
Saatchi says buyers will be encouraged because they can afford a bigger mortgage. And the higher demand should benefit sellers by boosting prices.
She says realtors should do well, also, because when people want to buy they'll be able to find something. And that means more sales.
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