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Investing March 19, 2002
Fed Moves to Neutral Bias
March 19, 2002 (PLANSPONSOR.com) - As expected, the
Federal Open Market Committee left short-term interest rates
unchanged amid signs that the US economy is slowly struggling
out of its slowdown.
Reported by Camilla Klein
The key fed funds rate, which determines all other US interest rates, will remain at its current 40-year low of 1.75%, although, the bias has been changed to neutral from an easing bias, setting the stage for future rate increases.
The announcement follows comments by Federal Reserve Chairman Alan Greenspan earlier in the month that an economic expansion is “well under way.”
This marks an end to the aggressive easing campaign, which saw the Fed cut rates eleven times last year in efforts to bolster the lackluster economy.