- Downplays rebound of housing market
- Current monetary policy unchanged
- Dow Jones Industrial Average fell after Fed statement
The Federal Reserve downgraded its assessment of the U.S. economy Wednesday, saying growth had slowed, but shied away from launching a fresh round of economic stimulus.
"Economic activity decelerated somewhat over the first half of this year," the Fed said at the conclusion of a two-day top-level meeting as it left current monetary policy in place.
The interest rate-setting Federal Open Market Committee (FOMC) said it expected "economic growth to remain moderate over coming quarters and then to pick up very gradually."
"The unemployment rate will decline only slowly," it said.
The bank also downplayed glimmers of hope that the housing market is starting to rebound, saying: "Despite some further signs of improvement, the housing sector remains depressed."
But there was no new action to juice the economy.
Instead bank policymakers reiterated their pledge to leave interest rates close to zero until the end of 2014 and reaffirmed their readiness to act.
Inaction Prompts Puzzlement
The decision not to pull the trigger on new measures puzzled some analysts and investors.
The Dow Jones Industrial Average fell sharply after the Fed statement was published. It ended the day down 0.3% and under the symbolic threshold of 13,000 points.
