Fed Sees Rate Low `for a Time' Then Possible Reversal |
| Bloomberg - Feb 21, 2008 |
Federal Reserve officials signaled they are prepared to quickly reverse last month's interest-rate cuts after concluding that borrowing costs need to be kept low for now.
Policy makers cut their 2008 growth forecasts and said that rates should be held down ``for a time,'' minutes of their Jan. 29-30 meeting showed yesterday. They also called inflation ``disappointing,'' and some foresaw raising rates, possibly at a ``rapid'' pace once the economy recovers.
The threat goes beyond remarks by Chairman Ben S. Bernanke, who last week warned that policy will have to be ``calibrated'' over the next year to meet both inflation and growth objectives. Central bankers are wary of past criticism for keeping rates too low, too long and inflating asset bubbles, said analysts including David Greenlaw at Morgan Stanley.
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- Posted: 2008-02-21 10:39:51
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