Fed not budging on short-term rates

Expanding MBS purchases an option

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A Federal Reserve committee that determines monetary policy is keeping its target for a key short-term interest rate at zero to 0.25 percent, saying economic conditions will likely warrant keeping it at "exceptionally low levels … for some time."

The Fed last month completed a series of 10 consecutive reductions to the federal funds rate, the rate banks charge each other for overnight loans. Before the cuts began in September 2007, the federal funds rate stood at 5.25 percent.