WASHINGTON (AP) _ It's been almost six months since the Federal Reserve last changed interest rates and if economists are reading the signals correctly, the central bank could go a full year before it tinkers with rates again.
Many economists said they believed the central bank is happy with the current slowdown it has engineered and is prepared to allow that process to continue as a way of wringing inflation out of the system.
That was the view after Federal Reserve Chairman Ben Bernanke and his colleagues met Tuesday and voted for a fourth consecutive time to leave the federal funds rate unchanged at 5.25 percent.
Fed officials did express a bit more concern about the impact their rate cuts were having, noting a ``substantial cooling of the housing market'' adding the word ``substantial'' to the assessment it had made in October.
But the changes the Fed made in its statement were so minor that it left private economists with the distinct impression that the central bank feels no need to make any changes in its current stay-the-course policy.
``The fact that there was very little change in the Fed's policy statement is a metaphor for no change in monetary policy any time in the future,'' said Mark Zandi, chief economist at Moody's Economy.com.
``The message here is that the Fed is going to keep policy unchanged for an extended period of time,'' said David Jones, chief economist at DMJ Advisors, a Denver consulting firm. ``Fed officials feel the economy is headed for a soft landing.''
The decision to stand pat on the federal funds rate, which had been widely expected, means that banks' prime lending rate, the benchmark for millions of consumer and business loans, will remain unchanged at 8.25 percent.
While Wall Street is hoping the Fed will consider cutting rates by March, because of the slowing economy, Zandi said such an early rate cut is not in the cards.
``If they had really wanted to change expectations about a Fed easing they would have changed the language they used on inflation, and they didn't,'' he said.
In its statement, the Fed sent the same signal on inflation, stating that ``the Fed judges some inflation risks remain.'' That is the wording the central bank has used to hold out the possibility for further rate increases.
While economists don't believe there will be any more rate boosts in view of the serious drop in housing activity, they also don't believe the Fed will move to cut rates until inflation pressures retreat.
The Fed's preferred gauge of inflation, which excludes energy and food, rose by 2.4 percent for the 12 months ending in October, well above the Fed's 1 percent to 2 percent comfort zone.
The Fed's goal is to achieve a soft landing for the economy in which growth slows enough to keep inflation under control but not so much that the country topples into a recession.
By the middle of next year, analysts said inflation should be headed lower while unemployment is likely to be approaching 5 percent, up from the current 4.5 percent.
That will be the time that the central bank will feel comfortable about starting to cut rates, they said.
``By midyear, the unemployment rate will be ticking up and the inflation rate will be ticking down, so they will be able to move,'' said David Wyss, chief economist at Standard & Poor's in New York.
Wyss said he is expecting three quarter-point rate cuts next year at the Fed's meetings in June, August and September.
He said that would be enough to make sure the economy, after slowing for a year, gets a second wind.
While some economists are worried that the Fed's hoped-for soft landing could be jeopardized by a more severe-than-expected housing downturn, Wyss said so far things are unfolding according to the Fed's script.
``The housing sector has been weak, but the rest of the economy looks fairly decent,'' he said. ``The soft landing looks like it is still in place.''