Fed looks to stabilise economy with rate hold

Against a backdrop of mounting concern over the health of the American economy, the Federal Reserve decided to leave its federal funds rate at 5.25% yesterday.

Though some traders called for a rate cut to stimulate growth, the Federal Open Market Committee, the central bank's rate-setting body, said that warding off inflation was its chief concern.

The Federal Reserve said: "Although the downside risks to growth have increased somewhat, the Committee's predominant policy concern remains the r