Fed Minutes Highlight Credit Market Concerns, Slower Growth Prospects

Federal Reserve officials lowered their growth forecast and said that they remain concerned about the credit market during their Oct. 30-31 meeting, Bloomberg News reported.

Fed policy makers also noted that the decision to slash U.S. interest rates by a quarter point, the second cut in as many meetings, was a “close call,” Bloomberg said.

Members of the Federal Open Market Committee said that growth in 2008 could slow to 1.8%, down from a prior estimate of 2.5% to 2.75%, Bloomberg reported.

``Participants generally viewed financial markets as still fragile and were concerned that an adverse shock — such as a sharp deterioration in credit quality or disclosure of unusually large and unanticipated losses — could further dent investor confidence and significantly increase the downside risks to the econ-omy,'' the minutes said.