Fed Holds Interest Rate at Record Low

The Federal Reserve voted Tuesday to keep a key U.S. interest rate at a record low rate of zero to 0.25%, though it cited concerns over continued high unemployment.

The move was the 17th straight time the Fed has done kept the rate at that level; it first did so in December 2008.

The economic recovery is continuing, “though at a rate that has been insufficient to bring down unemployment,” the Fed said. “Household spending is increasing at a moderate pace, but remains constrained by high unemployment.”

The Fed last held the “target range” federal funds rate — the rate that banks charge each other — at that level in November.

As with its recent rate decisions, Fed governor Thomas Hoenig was the Federal Open Market Committee’s lone dissenter in voting against keeping the rate low, citing long-term inflation concerns.

Click here for the Fed’s full statement. (Federal Reserve website.)