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 Federal Reserve Holds Rates Steady
The Federal Reserve voted to keep interest rates at 5.25% at it's last meeting; an indication of a slowing economy, and that the need to raise rates will not arise anytime too soon. This recent meeting marked the second time in a row that the Fed decided to hold interest rates steady without adjustment.
This new trend follows a consecutive 17 meetings where the Fed voted to increase the rates beginning back in June of 2004. The current decision to hold the rate steady was no real surprise to Wall Street. Some economists speculate that the current slowing trend of the housing market may prompt the Fed to begin cutting interest rates as early as 2007. There are those who believe that interest rate cuts in the near future would be unwise.

The Federal Reserve has had its work cut out for them as they try to slow the economy to a point where inflation can be kept under control without affecting growth. Some analysts speculate the Fed may have already raised rates too high; in turn creating an environment for slowed growth and a possible recession- a marker of that possibility is the slowing housing market.

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