Fed Leaves Key Interest Rate Alone

The Federal Reserve yesterday left the key interest rate unchanged at 2 percent, while stressing in their post-meeting statement that they’re concerned about both the struggling economy and high inflation.

"Although downside risks to growth remain, the upside risks to inflation are also of significant concern," the Fed said.

Observers say that the Fed is unlikely to change the key rate this year. "They really went right down the middle," says U.S. Global Investors research director John Derrick. "They are basically in risk-assessment mode."

Source: The Wall Street Journal, (08/05/2008)