U.S. bank keeps lending rate unchanged

June 25, 2008 at 2:58 PM

WASHINGTON, June 25 (UPI) -- The U.S. Federal Reserve Open Market Committee said Wednesday it would keep federal fund rates unchanged at 2 percent.

A bank statement explained the decision stating "overall economic activity continues to expand, partly reflecting some firming in household spending."

The employment picture remains weak and financial concerns "remain under considerable stress" the statement said.

But, the Committee expects inflation "to moderate later this year and next year," although rising energy prices add "uncertainty about the inflation outlook," the statement said.

Investors analyzing the decision will consider the voting record. Committee members were unanimous in keeping the rate unchanged with the exception of Richard Fisher, who voted to raise the rate, signaling a slight lean toward an increase, rather than another rate reduction.

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