As expected, the Fed announced a 50 basis point rate cut today. The move brings the benchmark rate down to 1%, the lowest level since 2004.

The Fed said that inflation was no longer a threat and that the central bank will cut rates as needed to boost the economy, according to Marketwatch.

Importantly, the Fed statement drew no line in the sand at the 1% funds rate target, raising the possibility that rates may move lower.

The move raises lots of technical questions about having rates so low, but analysts said these matters are of less concern than ending the credit crunch.

The last time the Fed funds rate was below 1% was in July 1958.

With interest rates so low already, economist at RBS Greenwich Capital, said the rate cut was a “side-show” and that the main event were the aggressive new measures undertaken to plug holes in the crumbling global financial system.

Analysts see some improvement in credit markets, but not much. The important London interbank rate remains well above the Fed funds rate.

Some analysts said the rate cut would put pressure on the European Central Bank to follow suit when they meet next week.