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Fed likely to keep interest rate unchanged


Fed likely to keep interest rate unchanged


The US central bank, the Federal Reserve, is expected to keep its benchmark interest rate unchanged at 2% at the meeting of its policy-setting committee this week.

It has more than halved rates since mid-September trying to prevent the housing slide and credit contraction from triggering a deep recession.

The problem for Fed Chairman Ben Bernanke is that he has to address inflation, which hit an annual rate of 4.2% in May without raising the cost of borrowing.

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