The Federal Reserve cut a key interest rate by a hefty half-percentage point Wednesday to prevent a widening credit crisis from tipping the United States into a deep and prolonged recession.

The Fed's decision takes its target for overnight bank lending to 1 percent, the lowest since June 2004. Wall Street was united in the opinion the Fed would lower rates, although views were split on the likely size of the move.

The U.S. central bank has cut benchmark overnight rates from 5.25 percent in nine steps over the past 13 months to counter a financial storm that started with the collapse of the U.S. mortgage market and spread around the world.