Fed holds line on interest rates

June 25, 2008 12:47:18 PM PDT
WASHINGTON (AP) - The Federal Reserve has left its benchmark interest rate unchanged. As result, the federal funds rate, the rate that banks charge each other, remains at 2 percent. In a statement, the Fed cited both high uncertainty about the inflation outlook, and downside risks to growth.

It is the first time in 10 months that the central bank has not reduced interest rates at one of its regular meetings.

The Fed vote was 9-1, with the president of the Dallas Fed casting a dissenting vote. He wanted an immediate rate hike.

The next policy meeting is set for early August.

On the Net: Fed statement: http://www.federalreserve.gov/newsevents/press/monetary/20080625a.ht m (Copyright 2008 by The Associated Press. All Rights Reserved.) AP-NY-06-25-08 1453EDT