Fed cites "pause" in growth, stands by stimulus

2:21 PM, Jan 30, 2013   |    comments
Police stand guard outside Federal Reserve Bank of New York building in Manhattan
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WASHINGTON (AP) - The Federal Reserve says growth "paused" in recent months and reaffirmed its commitment to boost a sluggish U.S. economy by keeping borrowing cheap for the foreseeable future.

The Fed took no new action after a two-day policy meeting. But it stood behind aggressive steps it launched in December to try to reduce unemployment.

Last month the Fed said it would keep its key short-term interest rate at a record low at least until unemployment falls below 6.5 percent. And it said it would keep buying $85 billion a month in Treasurys and mortgage bonds to try to keep borrowing costs low and encourage spending.

The Fed says the slowdown was because of weather-related disruptions and temporary factors.

Economic growth shrank from October through December for the first time since 2009.

(Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)

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