Will the Fed Stick to Its Plan on Low Rates?

[mumon]

http://www.nytimes.com/2003/12/08/business/08fed.html

The economy is growing much faster than expected and unemployment is edging down, but analysts do not expect the Federal Reserve to declare victory when its policy making committee meets Tuesday.

Fed officials have made it clear that they see no need to raise the federal funds rate, which is the interest rate at which banks lend to each other overnight, any time soon. The rate is currently 1 percent, which is the lowest rate in 45 years.

The real question is whether the central bank will retreat from its open-ended commitment to keep rates low "for a considerable period." Retreating from that commitment would be a first step toward tightening monetary policy, putting markets on alert that rate increases are possible several months down the road.

The really odd part of this story is that the fact that the dollar is in the toilet w.r.t. every other currency isn't mentioned at all.

Our low interest rates are keeping the dollar low too; eventually - probably soon- inflation's gonna bite hard.