Fed leaves rates unchanged

The Fed left the funds rate unchanged at today’s policy meeting. Here is the post-meeting statement …

“The Federal Open Market Committee decided today to keep its target for the federal funds rate at 2 percent.

“Strains in financial markets have increased significantly and labor markets have weakened further. Economic growthappears to have slowed recently, partly reflecting a softening of household spending. Tight credit conditions, the ongoing housing contraction, and someslowing in export growth are likely to weigh on economic growth over the next few quarters. Over time, the substantialeasing of monetary policy, combined with ongoing measures to foster market liquidity, should help to promote moderateeconomic growth.

“Inflation has been high, spurred by the earlier increases in the prices of energy andsome other commodities. The Committee expects inflation to moderate later this year andnext year, but the inflation outlook remains highly uncertain.

“The downside risks to growth and the upside risks to inflation are both of significantconcern to the Committee. The Committee will monitor economic and financial developments carefully and will act asneeded to promote sustainable economic growth and price stability.

“Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; Christine M. Cumming; Elizabeth A. Duke;Richard W. Fisher; Donald L. Kohn; Randall S. Kroszner; Sandra Pianalto; Charles I. Plosser; Gary H. Stern; and KevinM. Warsh. Ms. Cumming voted as the alternate for Timothy F. Geithner.”

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