“We can and we will restore order to the credit markets,” Fisher said during a panel discussion sponsored by the Institute of International Finance in Washington.

He said the United States faces a “painful” period and pledged that the Fed would do “whatever” is necessary to ease the strains on markets and the economy.

In his remarks, Fisher said he was breaking from Fed officials’ public-speaking tradition of not talking on behalf of the entire policy-making Federal Open Market Committee.

“This morning I am casting that convention aside,” he said. “I speak for all of us when I say that the Federal Reserve will continue to explore every avenue and consider every option to see the credit markets through the credit crisis.”

The Fed, the European Central Bank and other central banks lowered interest rates last week in an unprecedented coordinated effort to ease the economic effects of the freeze in credit markets.

Fisher voted for the policy change after dissenting as recently as August 5 against holding the benchmark rate unchanged in favor of an increase because of inflation concerns.

The Fed reduced its benchmark rate to 1.5 per cent. Traders anticipate another quarter point cut by the Federal Open Market Committee’s October 28-29 meeting.

The Fed is facing increasing evidence that the US may already be in a recession. Labor Department figures showed October 3 that payrolls fell by 159,000 in September, the biggest reduction in five years. While the unemployment rate held at 6.1 per cent, that’s up from 5 per cent as recently as April.