Economists look to see what Fed says about US economy

Economists look to see what Fed says about US economy
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Federal Reserve officials are holding their monthly meeting. Most economists expect they will keep the key US interest rate unchanged at 5.25%. However the markets will be looking at the statements made by Fed Chairman Ben Bernanke and his colleagues at the end of the two day meeting to see if they hint at interest rate cuts later in the year if the US economy continues to lose momentum.

Some economists expect them to speak of their concern about economic conditions allow them to change their rate outlook if the economic situation deteriorates more than expected. The problem for the policy makers is that inflation is not going away with hourly wages in February rising faster than anticipated. That may mean that the Fed has to hold rates steady for the foreseeable future or even have to raise them.

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