Yesterday's dramatic cuts in interest rates leave an important question lingering over the financial markets: How much more must the Federal Reserve Board ease credit to pull the U.S. economy out of recession?

The answer seems to be more than it has already if it wants to counter the dismal effects of a shakybanking system, a widening federal budget deficit at home and pressure for tighter money coming from abroad.

"The Fed will continue to ease until they see some signs of life in the economy. We haven't got a pulse at this point," said Stephen D. Slifer, an executive vice president and financial market economist at Lehman Brothers Inc. in New York. "It seems clear to me that the level of rates that exist currently is not enough to do the trick."

Added a veteran Fed-watcher: "I can guarantee you that this will not be the last downward move on interest rates here."

Concerns over the issue of "How much is enough?" were a principal reason for the mixed reception that the financial markets gave the Fed's large, half-point reductions today in two key interest rates -- the discount rate and federal funds rate.

The bond market rallied briskly on the news but a confused stock market finally ended the day down 5.70 points.

The conflicting signals reflected the financial markets' uncertainty over whether to place more emphasis on happiness that interest rates were coming down or worry over the very negative employment data that triggered the Federal Reserve's action.

Usually, lower interest rates are a bracing tonic for the financial markets. Lower rates have the doubly favorable impact of promoting economic activity by making it cheaper for businesses and investors to borrow, and more attractive to move investment cash out of bank and money market accounts into stocks and bonds.

Today, however, the markets wavered because the cut in interest rates was a direct response by the Fed to dramatic new signals indicating that the recession may be deeper and longer than investors were expecting just a few days ago.

"The report showed a lot more weakness in the economy than people had been looking for. Rates have a long way to go {down}," said Elliott Platt, director of economic research at Donaldson, Lufkin & Jenrette Inc. in New York.

One reason for the caution is that many of the nation's banks have such weak balance sheets that they may be reluctant to increase their lending even if they can borrow money more cheaply because of lower interest rates.

"You can bring the funding costs down for banks, but you can't make them lend," said Raymond W. Stone, managing director of Stone & McCarthy Research Associates Inc., an economic analysis firm in Princeton, N.J.

The Fed's leeway also is limited by the widening federal budget deficit and rising interest rates abroad, especially in Germany, which raised its discount rate Thursday by the same amount that the Fed lowered U.S. rates yesterday.

Three-month German government obligations, for example, were earning between 9 1/8 9.13 and 9.25 percent yesterday, more than 2 full percentage points higher than the U.S. 90-day yields of approximately 7 percent. That difference encourages investors to shift money out of U.S. financial markets and into German ones. And those shifts quickly are reflected on world currency markets, as they were yesterday, when the dollar declined in panicky trading.

But a number of market experts said yesterday that the only surprising thing about the dollar's recent slide was that it hadn't gone further.

"There is still no good reason to buy dollars," a New York trader said.

"The dollar behaved quite well, considering that our interest rates went down and Germany's went up," said New York investment banker Henry Kaufman. "I was pleasantly surprised."

One explanation for the dollar's resistance to downward pressures is an underlying optimism, also reflected in the stock market's recent ebullience, in the prospect that the Persian Gulf War will be short and could be followed by a consumer-led upturn.

In addition, the German authorities are expected to be subjected to considerable pressure from other European Community nations to halt the upward trend of interest rates, which they fear will spill over into their own weakening economies.

Indeed, the principal concern expressed by financial market observers yesterday was not that the dollar might plunge to new lows -- which they said was likely -- but that the underlying fundamentals suggest the possibility of global recession. The United States, Britain and Canada already are in the middle of a decline, and France, Italy and Spain are slowing down.