Fed keeps rates on hold as slowdown in growth seen temporary

WASHINGTON (May 4): Federal Reserve officials remained on track to gradually tighten monetary policy after leaving interest rates unchanged and signaling they were not alarmed by recent US economic weakness.

“The committee views the slowing in growth during the first quarter as likely to be transitory,” the Federal Open Market Committee said in a statement Wednesday following a two-day meeting in Washington. “Near-term risks to the economic outlook appear roughly balanced.”

US central bankers were unusually explicit in their statement, indicating that a disappointing first quarter, in which the economy grew at an annualized rate of 0.7%, would not knock the committee off its plan to raise rates two more times this year after a hike in March.

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