|
|
|
|
|
|
| |
| |
By Category |
 |
|
|
| |
|
| |
| |
India On Media |
|
|
|
| |
|
| |
|
|
| Others
News |
|
| US interest rates left unchanged |
| US interest rates have been kept on hold, despite mounting fears about the state of the economy.
|
| UNITED STATES OF AMERICA
, 8-August-2007
3:35:57 AM |
| Analysts had widely predicted the US Federal Reserve would leave rates at 5.25% for a 13th month, and that was the unanimous verdict of the Fed panel.
Concerns over the economy's health have been mounting amid a rise in bad debts, particularly in the housing sector.
Elsewhere, signals are mixed, with growth higher than expected but job creation slowing and inflation high.
Lending worries
US markets have been oscillated wildly in recent weeks as worries about the housing market have mounted.
The Fed acknowledged the turbulence and said the downside risks to the economy had "increased somewhat".
But the Fed continued to state that the predominant risk remained that inflation "will fail to moderate as expected".
While the property market has been hit by a prolonged slump, sub-prime lenders have been bearing the brunt of the fall.
A number of such companies - which lend money to people with poor credit histories - have issued profit warnings.
Others, including American Home Mortgage, are teetering on the brink of bankruptcy.
Wider concerns
Elsewhere the Fed is still facing a tough balancing act to keep the economy on course.
In an effort to control spiralling inflation - and bring about a gradual soft landing for the economy - it raised rates for a record-setting 17th time in a row to 5.25% in June last year.
But oil prices - one of the main drivers of inflation - have remained stubbornly high at over $70 a barrel, leading to high energy costs which have prevented the Fed from cutting rates.
Elsewhere, it is still unclear whether the recent growth spurt experienced by the economy is sustainable in the face of the current housing market slowdown.
While growth rebounded to 3.4% between April and June from 0.6% in the previous quarter, jobs growth has slowed more than expected with just 92,000 jobs created in July.
|
|
|
|
|
|
|
|
ADVERTISEMENTS
Free offer!!! Become an administrator for your zip home page, "Post" local news (local to your postcode)& pictures, "Post" advertisement banners from local companies. Make Extra money.
|
 |
 |
|
|
| |
|
