Fed Holds Interest Rates Steady, Warns on Inflation

by Patrick Lunsford, CollectionIndustry.com

The Federal Open Market Committee voted to hold interest rates steady at 5.25% in their meeting yesterday, as expected. The move marks the third straight meeting with no change in rate policy.

The Fed, however, did leave the door open for further increases if inflation continues to rise.

"Economic growth has slowed over the course of the year, partly reflecting a cooling of the housing market," the FOMC said in an accompanying statement. "Going forward, the economy seems likely to expand at a moderate pace. Nonetheless, the committee judges that some inflation risks remain.” Further rate hikes, if any, would depend on "the evolution of the outlook for both inflation and economic growth."

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