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Bernanke's Inflation Talk Takes Emphasis Off Of Slowdown

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The Federal Reserve's policy makers ratcheted up their worries about inflation on Wednesday without abandoning their view that the American economy is weak.

They left the key short-term interest rate they control unchanged, ending a streak of rate cuts stretching back to last summer, when the bursting of the housing bubble and the ensuing credit squeeze brought economic growth almost to a halt.

At the end of a two-day meeting, the Fed officials voted to hold at 2 percent the short-term federal funds rate, which affects what consumers pay for mortgages, car loans and other credit. In a statement, the 10 policy makers made inflation more of a concern than economic weakness, the first time they had done so in months.

Read the whole story at New York Times