Fed Leaves Interest Rate at 5.25 Percent
Wednesday September 20, 2:17 pm ET
By Martin Crutsinger, AP Economics Writer
Fed Leaves Interest Rate Steady As Falling Energy Prices Help to Restrain Inflation Pressures
WASHINGTON (AP) -- The Federal Reserve left a key interest rate unchanged on Wednesday as falling energy prices helped to restrain inflation pressures.
Federal Reserve Chairman Ben Bernanke and his colleagues issued a brief announcement saying they would leave the federal funds rate, the interest that banks charge each other, at 5.25 percent.
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The decision represents a break for borrowers. It means that banks' prime lending rate, the benchmark for millions of consumer and business loans, will remain at 8.25 percent.
The Fed also had left rates unchanged at their last meeting in August, breaking a record string of 17 rates hikes that had driven the funds rate to its highest level in more than five years.
The decision to leave rates alone for a second time had been widely expected in financial markets, given recent favorable developments on inflation. Oil prices have fallen by more than 20 percent over the past two months and a cooling housing market has contributed to a slowdown in overall growth.
Wednesday September 20, 2:17 pm ET
By Martin Crutsinger, AP Economics Writer
Fed Leaves Interest Rate Steady As Falling Energy Prices Help to Restrain Inflation Pressures
WASHINGTON (AP) -- The Federal Reserve left a key interest rate unchanged on Wednesday as falling energy prices helped to restrain inflation pressures.
Federal Reserve Chairman Ben Bernanke and his colleagues issued a brief announcement saying they would leave the federal funds rate, the interest that banks charge each other, at 5.25 percent.
ADVERTISEMENT
The decision represents a break for borrowers. It means that banks' prime lending rate, the benchmark for millions of consumer and business loans, will remain at 8.25 percent.
The Fed also had left rates unchanged at their last meeting in August, breaking a record string of 17 rates hikes that had driven the funds rate to its highest level in more than five years.
The decision to leave rates alone for a second time had been widely expected in financial markets, given recent favorable developments on inflation. Oil prices have fallen by more than 20 percent over the past two months and a cooling housing market has contributed to a slowdown in overall growth.
