WASHINGTON (AP) -- Federal Reserve officials at their March meeting stressed the importance of making sure record-low interest rates don't feed new speculative bubbles in stocks or other assets.
Still, some officials said the Fed's pledge to keep rates low for an "extended period" doesn't mean a fix period of time. Rather, it depends on the strength of the economy, according to minutes of the closed-door meeting released Tuesday. Analysts have taken the pledge to mean rates need to stay at record lows for roughly six months to help underpin the recovery.
Those Fed officials argued that the pledge won't stop the Fed from boosting rates if the economy showed signs of picking up substantially or if inflation took off. On the other hand, the pledge "could last for some time" if the economy took a turn for the worse.
Fed says "extended period" may last a long time
On Tuesday April 6, 2010, 2:59 pm
By Pedro Nicolaci da Costa
WASHINGTON (Reuters) - The Federal Reserve could keep interest rates ultra-low for even longer than investors expect if the economic outlook worsens or inflation drops, minutes from the central bank's last meeting suggested.
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