Fed Cuts Rate to 0%-0.25%

The Federal Reserve today 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 0% to 0.25%.

That is down from the 1% target rate in effect since its 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. (More Ben Bernanke stories.)