Fed leaves funds rate unchanged at 2 percent

Source: Associated Press via Yahoo! News

The Federal Reserve, confronted with the perils of a slumping economy and rising inflation, has decided for a second straight meeting to leave interest rates unchanged.

The Fed announced Tuesday that it was keeping its target for the federal funds rate, the interest that banks charge each other, at 2 percent.

The decision has been widely expected by financial markets. Shortly after the Fed announcement, the Dow Jones industrials were up 227 points at the 11,511 level.

The Fed is caught between what many economists believe is a recession and rising inflation pressures, triggered by this year's huge runup in energy prices


Read more: http://news.yahoo.com/s/ap/20080805/ap_on_bi_ge/fed_interest_rates

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Regarding that last line. None dare call it 'stagflation'?

I have no faith in our economy. It's broken and not credible...

its like a bear one day it may be all friendly then the next day it bites you on the ass.

stagflation is the perfect analysis imo.