March 16th, 2010
02:24 PM ET

Fed: Low interest rates will continue

The Federal Reserve left its key interest rate near 0% once again Tuesday and said rates should stay this low for the foreseeable future.

Fed policymakers repeated their prediction that economic conditions are likely to result in "exceptionally low levels of the federal funds rate for an extended period."

That promise of an easy-money policy has been in place since March 2009.

Some economists, including Kansas City Fed President Thomas Hoenig believe the Fed needs to drop that promise.

Hoenig voted against keeping this language in place for the second straight meeting.He and some Fed critics worry that the central bank could be creating new bubbles in financial markets by keeping rates so low for such a long time.

The so-called fed funds rate, a benchmark that determines the interest paid by consumers and businesses on a wide variety of loans, has been near 0% since December 2008, as the central bank worked to spur greater lending and economic activity.

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