Get more! Sign up for PLANSPONSOR newsletters.
Investing June 26, 2002
Interest Rates Stay Put
June 26, 2002 (PLANSPONSOR.com) - Members of the
Federal Open Market Committee (FOMC) voted unanimously to
keep the federal funds rate unchanged at 1.75%, despite
increases in economic activity.
Reported by Camilla Klein
Commenting on the decision to keep rates at a four-decade low, the FOMC pointed to the leveling of the upswing in inventory investment. In addition, growth in final demand appears to have moderated.
The FOMC said in a press release that it expects “the
rate of increase of final demand to pick up over coming
quarters, supported in part by robust underlying growth in
productivity, but the degree of the strengthening remains
uncertain.”
The statement said risks were equally balanced between
economic weakness and a flare-up in inflation, a stance
unchanged from the last meeting on May 7, but economists
said its overall downbeat tone indicated no rate increases
were likely in the imminent future.
US interest rates have remained at this level since December 2001.