WASHINGTON (MarketWatch) -- Supportive economic data made the decision to hold rates steady in September an easier decision than the "close call" in August, according to the minutes of the Sept. 20 meeting released Wednesday. "Members noted that certain developments of late - appreciable declines in energy prices, some softer indicators of economic activity, and slightly lower readings on core inflation - pointed to a modestly better inflation outlook and hence made the policy decision today somewhat less difficult than it was in August, when it was seen as a particularly close call," the minutes said. The FOMC was clearly focused on the housing slowdown, and members were uncertain about the extent of the downturn and whether it would spillover into other sectors. In general, the economy was expected to slow in the near term. A severe downturn, although not the forecast, could not be ruled out. For the second straight meeting, Jeffrey Lacker of the Richmond Fed dissented in favor of a rate hike. He said the economy was unlikely to slow enough to bring core inflation down.
RIP 2/12/04