Federal Reserve Raises Key Rate a Quarter Point as Expected

REUTERS
August 10, 2004

WASHINGTON, Aug 10 (Reuters) - The U.S. Federal Reserve on Tuesday raised interest rates another quarter of a percentage point to head off potential inflation, saying the economy was poised to pick up after a recent slowdown.

The unanimous decision by the U.S. central bank's policy-setting Federal Open Market Committee moves the benchmark federal funds rate -- which influences credit costs throughout the economy -- to 1.5 percent. It was the second quarter-point increase this year, following one announced on June 30 after the last FOMC meeting.

The Fed action came despite anemic job growth in July as well as soaring oil prices that hit records above $45 a barrel on Tuesday.

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