By Evelina M. Tainer, Chief Economist, Econoday
6/29/01

The Federal Reserve reduced the federal funds rate target by 25 basis points on Wednesday but maintained its bias against economic weakness. Fed watchers who scrutinize every word of the announcement said the removal of the "monitor closely" phrase could imply less of a chance for an inter-meeting move. Nevertheless, since the risks remain weighted toward economic weakness it is certainly possible that the Fed could cut rates again at the August meeting. In any case, that meeting is several economic indicators away and conditions could shift between now and then.