RTTNews - The U.S. Federal Reserve on Wednesday left interest rates at historic lows once again and pledged to continue to use all available tools to prop up the ailing economy.
The central bank stated that the economy shows signs of leveling out, though it warned that businesses and consumers continue to face significant pressures.
The Fed also noted that its purchases of Treasury securities, a move it had taken to help stimulate the economy, will be finished by the end of October.
The Federal Open Market Committee, the policy-making arm of the Federal Reserve, announced that it was maintaining the target range for its benchmark federal funds rate at zero to 0.25 percent.
The Fed also repeated its belief that low rates will persist for what it calls an extended period.
In making its assessment of the economy, the central bank cited further improvement in financial markets and signs of stabilization in household spending. Another benefit is coming from progress made by businesses in rationalizing their inventory levels, the Fed stated.
However, weak spots in the economy still persist. Specifically, policy-makers noted that ongoing job losses, sluggish income growth and tight credit are among the conditions putting pressure on the average consumer.
Meanwhile, businesses continue to cut back on fixed investment and staffing.
Inflation was not cited as much of a worry in the Fed's statement - the central bank said inflation will likely stay subdued for some time.
Going into the meeting, the Fed was universally expected to leave rates unchanged, but there was some speculation that the central bank could announce the end of its program to buy treasury bonds, a move it had undertaken to pump money into the economy.
In recent weeks, Fed directors, including Fed Chairman Ben Bernanke, have said that the economy is stabilizing, but they have also said that weakness in income growth and unemployment will likely continue.
Bernanke and the Fed have faced criticism in the wake of last year's financial crisis. While most give the chairman and his fellow policy-makers high marks for their efforts to limit the impact of the recession, they have also been accused of allowing the crisis to develop in the first place.
There are doubts about whether President Barack Obama will reappoint Bernanke to another term, and some experts feel that the scrutiny will force the Fed to make any shifts in policy as gentle as possible.
Vincent Reinhart, a resident scholar at the American Enterprise Institute and a former director of the Fed's Division of Monetary Affairs, told RTTNews that he believes the Fed wants to keep as low a profile as possible, but it still wants to take some credit for economic improvement in an environment in which they feel they are unjustly taking heat.
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