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The Economy

August 19, 1996|Times Staff and Wire Reports

Fed to Weigh Interest Rate Policy: The central bank will consider this week whether inflationary pressures are such that it should raise rates in an effort to cool the economy. Most economists expect the Federal Reserve Board's policymaking Federal Open Market Committee, which will meet Tuesday, to leave rates alone. Recent economic reports have sent mixed signals about the economy's vigor, after a powerful surge of growth in the second quarter. Most economists believe the number of question marks is such that the Fed won't act now, though some say there could be a precautionary rate rise later in the year should the economy show signs of expanding too rapidly. Of 30 economists in a Reuters survey taken last week, none forecast a rate move for this week. That sentiment, now widespread, contrasts with the one of a few weeks ago. Then, all but a few experts were foreseeing a rate increase.

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