Business

Fed"s decisions
by Claudia Sonea

After Friday and Monday madness, Tuesday at the Federal Reserve meeting the interest rate remained at 5.25 percent, making the investors to bid higher. A lot of other important decisions were made and also a lot of concerns were revealed at that meeting. Some of the biggest issues that pose risk to the economy are Wall Street turbulence, Main Street credit problems and a nationwide housing slump, but the most important is the inflation. One of the decisions was to establish a 8.25 rate for commercial banks' prime interest for certain credit cards, home equity lines of credit and other loans. There were forecasts of growth in employment and incomes, rates' cuts if the inflation remains stable and the economy will expand. The national economy is depending on the flow of credit, so if there will be any more restrictive lending conditions, the people will lose their ability to acquire a big credit like that for houses, cars, etc. The reduced appetite will be reflected in the overall economic activity that will become slower and slower. Gasoline prices receded at 3 dollars a gallon in some cities and the core inflation rose 1.9 percent over the 12 months. The economy grew at a solid 3.4 percent pace and the forecast is good. Unemployment rate is likely to grow to 5 percent by the end on the year, according to analyst. That is not a good thing, especially because it represents the blood of economy. However, despite all the drags, economy is expected to bounce. Stay close to see where it will get!

related story: http://news.yahoo.com/s/ap/20070807/ap_on_bi_ge/fed_interest_rates;_ylt=AuKuZI2lA8GE.Nc2yUMAoJ.s0NUE

by Claudia Sonea for PocketNews (http://pocketnews.tv)

PocketNews is a new real-time news broadcaster delivering the latest and hottest news right to your pocket ! With global clients who want to be kept up to date, PocketNews is everyone's way of keeping in touch with the World.

posted by Blog TechSource @ 12:52 PM