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Fed Stands Pat on Policy But Hints of Change
The Federal Reserve Bank has disappointed investors by leaving the key overnight bank lending rate unchanged in a range of zero to 0.25% and declining to take other actions to jump-start the flagging U.S. economy.
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The Federal Reserve Bank has disappointed investors by leaving the key overnight bank lending rate unchanged in a range of zero to 0.25% and declining to take other actions to jump-start the flagging U.S. economy.
But Fed-watchers believe the wording of the central bank's statement on Wednesday suggests a willingness to act soon, perhaps when its policymakers next meet in mid-September.
The Fed notes that economic activity decelerated during the first half of this year and predicts the job market will improve very slowly. The central bank also says it will "closely monitor" economic and financial developments and provide additional stimulus as needed.
The Fed's options including launching a huge securities-buying program to pump billions of dollars into the economy or extending the timeframe on its promise to keep interest rates ultra-low. The bank currently pledges that rates will remain extremely low at least through 2014.
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