​ Federal Reserve Stays On Hold at 1-​Year Anniversary of Last Rate Hike. The Federal Reserve Board of Governors left its short-​term benchmark Federal funds target rate unchanged at 5.​25%. (​See the Fed'​s statement and our "​Link of the Day".) It'​s been exactly one year since the Fed last raised rates, making this the longest stretch of unchanged rates since the record low 1% rate July 2003 through June 2004 (​long spells of unchanged rates are rare). An 18-​month stretch of 5.​5% rates from April 1997 through September 1998 ranks as the next longest unchanged time, a period -- with 5+% nominal rates and 3% (​or so) real rates, a booming economy and rising stock market -- that looks very much like the current one. The latter 1990'​s saw one of the best stretches of money fund asset growth in history. In 1997, funds grew by 17.​4%, and, in 1998, assets grew by 27.​7%. Today'​s statement says the "Committee'​s predominant policy concern remains the risk that inflation will fail to moderate as expected", so all indications are that rates will remain on hold and that flat is very good for money funds.

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