WASHINGTON (Oct. 25, 2006) — The Federal Open Market Committee voted to hold a key interest rate unchanged at 5.25 percent, citing “inflation risks” that remain.
The Fed said that economic growth has slowed over the course of the year, partly reflecting the cooling housing market. The economy seems poised to expand at a moderate pace.
Core inflation measures seem to be elevated, the committee said, but inflation pressures seem likely to moderate over time. However, the committee judged that inflationary risks continue, and “additional firming” depends on the inflation and economic outlook.