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Fed doesn't act on rates
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December 22, 1998: 2:28 p.m. ET
FOMC meeting leaves Fed funds rate at 4.75%, discount rate at 4.50%
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WASHINGTON (CNNfn) - In a sign that it believes the U.S. economy is on track, the Federal Reserve Board's policy-making body took no action on interest rates in its meeting Tuesday.
The federal funds rate, which banks charge each other for overnight loans, remained at 4.75 percent. The discount rate, charged on emergency loans to banks, was held at 4.50 percent.
The Federal Open Market Committee's lack of action was expected. Analysts had said the FOMC would hold rates steady amid signs that the U.S. economy is strong - even as the financial picture in other countries remains turbulent. Such an action would give the U.S. a chance to absorb the three rate cuts implemented by the committee this fall.
The FOMC acted to cut the fed funds rate by a quarter-point at meetings on Sept. 29 and Nov. 17. It also cut the rate a quarter-point on Oct. 15, the first such action between meetings since 1994. Quarter-point cuts in the discount rate were implemented in September and October.
The rate cuts were seen as a signal by Fed chairman Alan Greenspan that he was concerned that the economic slowdown overseas would spread to the United States. And analysts said they expected the FOMC will cut rates again early in 1999, believing that U.S. consumers won't be able to make up the shortfall in orders from slumping markets in Asia.
The FOMC's next scheduled meeting is a 2-day session Feb. 2-3. A one-day session is scheduled for March 30. 
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Federal Reserve Board
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