Saying worries about inflation outweigh the ongoing “adjustment in the housing sector,” the Federal Reserve’s Open Market Committee said Wednesday it is keeping the short-term federal funds rate at 5.25 percent.

The rate banks charge each other for overnight loans has been unchanged since June, when the committee approved the last of 17 straight 25-basis-point increases.

Some economists have predicted the Fed would lower short-term rates in 2007 to ward off the threat of a recession. But for now, the economy seems likely to continue to expand at a moderate pace, the Committee members said in a statement, and their predominant concern “remains the risk that inflation will fail to moderate as expected. Future policy adjustments will depend on the evolution of the outlook for both inflation and economic growth, as implied by incoming information.”

The committee is scheduled to meet again May 9.

Show Comments Hide Comments


Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
Thank you for subscribing to Morning Headlines.
Back to top
Leaders from across the industry answered our call to come to Inman Connect and share essential advice for leveling up your 2021.SEE THE SPEAKERS×
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription