The Federal Open Market Committee meeting today yielded no change in the federal funds rate, which the panel held at 2%, and offered no bias, citing upside risks to inflation and downside risks to growth.

“Economic activity expanded in the second quarter, partly reflecting growth in consumer spending and exports,” the FOMC statement said. “However, labor markets have softened further and financial markets remain under considerable stress. Tight credit conditions, the ongoing housing contraction, and elevated energy prices are likely to weigh on economic growth over the next few quarters. Over time, the substantial easing of monetary policy, combined with ongoing measures to foster market liquidity, should help to promote moderate economic growth.

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