Fed meets with eyes on policy forecasts

The US Federal Reserve building is seen on August 8, 2011 in WashingtonThe Federal Reserve should keep US monetary policy unchanged in a two-day meeting beginning Tuesday, but analysts will look for any hint on changes to the trajectory for interest rates. Even if the current policy is locked in place — keeping the benchmark federal funds rate at zero, and steadily cutting back the now $45 billion a month bond-buying stimulus program — the Federal Open Market Committee will have much to discuss. The FOMC has consistently pointed to the middle of 2015 at the earliest for beginning to raise the fed funds rate. One says inflation is picking up, the jobs market is tightening, and that bubble-like tendencies are showing up in markets due to the prolonged period of easy money.

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