Fed keeps 2 percent interest rates
August 5, 2008
The Federal Reserve decided to keep the federal funds rate at 2 percent, as the country faces a sluggish economy with rising inflation.
Economic activity expanded in the second quarter, partly reflecting growth in consumer spending and exports. On the other hand, financial markets continue to struggle. Other factors influencing the decision were related to tight credit conditions, the ongoing housing contraction, and elevated energy prices, which are likely to weigh on economic growth over the next few quarters, according to the Fed’s August 5 press release.
