It's True: The Fed Has Already Cut Fed Funds to 5%
![](https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjHoypzYQWk8B_0MjBjVAADuDbQGyokIokclWAKVwkyRGVZMHJwBCE99KrNMmxBERYgELHEhyzMgsiFDarbp-hB2uG6zPouNdhko6KK9FZ1T9wka941p9pUa5YMq-ASOQUfXtp7/s400/ff.bmp)
As Mankiw points out, the Fed was able to hit its target rate of 5.25% in every month since the Fed Funds target was increased from 5% to 5.25% on June 29, 2006. But in August, the average daily Fed Funds rate fell to 5.02% and so far this month the average is 4.99%. In fact, the effective Fed Funds rate has been below 5% on 8 out of the last 11 days, and has been below 4.9% on 3 out of the last 4 days.
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