NEW YORK: Two of the biggest US banks, JPMorgan Chase & Co and Citigroup Inc, on Wednesday lowered their benchmark rates for a wide range of consumer and commercial loans, following a rate cut from the Federal Reserve.

Starting on Aug. 1, both banks said they will reduce rates by 25 basis points to 5.25%.

The banks use different names -Citi calls this its "base rate," and JPMorgan refers to a "prime rate." However, lowering this benchmark rate means lower interest rates on loans that are based off the Fed's main short-term rate. The move could result in lower revenues for the banks in the coming quarters.

Earlier on Wednesday, the US Federal Reserve cut the overnight lending rate to a target range of 2.00% to 2.25% due to concerns about the global economy and muted US inflation. The US central bank signaled a readiness to lower borrowing costs further if needed.

Although banks were expected to lower rates in line with the Fed, the moves were notable because rates had been rising for more than a decade.

The last time JPMorgan reduced its prime rate was December 2008, when it cut the rate to 3.25% from 4%. The bank maintained a 3.25% prime lending rate for the next seven years, eventually raising it to 3.5% in December 2015.