Over the past couple of weeks, Fed officials have said in speeches that they expect falling energy prices to reduce the upward pressure on the core inflation rate. If they're right, the Fed's rate-setting committee might not need to raise short-term interest rates. The rate-setting panel meets next week and is expected to retain its watching-and-waiting stance while keeping rates untouched.
Fed officials plan to watch and wait because they believe the economy hasn't felt the full effects of 17 straight rate increases in two years. They were trying to cool off the housing sector, and they seem to have succeeded: Median prices are down slightly, and house construction has fallen off. But the record there is mixed, too.
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