The Federal Reserve kept interest rates near zero on Wednesday and said the economy is improving. But the Fed also pointed out ongoing job losses could dampen a recovery.
At the conclusion of its two-day meeting Wednesday, the Federal Open Market Committee said that the government's stimulus and economic rescue actions have helped to stabilize the financial markets, which will help generate economic growth in the future.
"Economic activity has picked up following its severe downturn. Conditions in financial markets have improved further, and activity in the housing sector has increased," the Fed said in a statement. It was the first time since August 2008 in which the FOMC said the economy had improved from its previous meeting.
Meanwhile, the Fed said consumer spending is stabilizing, but that rampant job loss and tight credit has restrained overall household consumption. The Fed added that although the housing sector has begun to make a comeback, home sales and new home construction are coming off of historic lows.
As a result, the Fed kept its federal funds rate, an overnight lending rate that guides rates on various consumer and business loans, in a range of 0% to 0.25%. Rates have been at that level since December.