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Fed poised to keep rates low to support rebound

WASHINGTON — Confidence is growing that the economic rebound will strengthen. And to make sure it does, the Federal Reserve is considered certain to hold interest rates at record lows when it meets this week.

Fed Chairman Ben Bernanke and his colleagues will open a two-day meeting today at a time when the economic outlook has been brightening. Employers are creating jobs, Americans are spending more and manufacturers are boosting production.

Other signs point to a still-bumpy recovery. Unemployment remains near double digits and is expected to stay high all this year. Banks aren't lending at normal levels and demand for loans is still low.

Despite a burst in home sales last month as buyers scrambled to take advantage of a soon-to-expire home buyer tax credit, the housing market is still fragile. So is the commercial real estate industry.

For all these reasons, the Fed is all but certain to leave its key bank lending rate between zero and 0.25 percent, where it's remained since December 2008.

Super-low rates serve borrowers who qualify for loans and are willing to take on more debt. But they hurt savers.

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