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The Federal Reserve had boosted interest rates 17 times starting in June 2004 in an effort to choke inflation.
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Investors wondered whether a series of ominous warnings about rising inflation meant that the Fed might raise rates by the end of the summer to help choke off inflation.
The Federal Reserve can try to choke off inflation by raising its benchmark interest rate.
Policy makers can generally choke off inflation by raising interest rates, dampening economic activity and reducing demand for goods.
It would probably give comfort to those who are convinced that the Fed will act aggressively at its next meeting -- by raising short-term rates by half a percentage point -- to choke off inflation before it chokes the economy.
D1 BUSINESS DAY C1-14 MoRatese Rates Defy Trend The Fed has lifted its benchmark short-term rate eight times since last summer in an effort to choke off inflation, but during that time mortgage rates have continued to fall -- a situation that Alan Greenspan, the Fed chairman, called "clearly without recent precedent".
But before long, another recession (with luck, shallow), is created by the Fed raising interest rates to choke off inflation.
The Fed would raise interest rates in order to choke off inflation.
The Fed didn't raise interest rates to choke off inflation.
But that era, which featured a double-dip recession, coincided with the Federal Reserve's decision to lift interest rates sharply to choke off inflation, a step that crimps economic activity.
Until last week, Europe's chief central banker, Jean-Claude Trichet, had seemed more concerned about choking off inflation by raising interest rates.
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CEO of Professional Science Editing for Scientists @ prosciediting.com