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Fed Hints End Nigh For Rate Increases; Factory Index Falls; Stocks, Bonds Rally Hard; Few extra rate hikes likely as inflation worries ease: Dec. 13 FOMC minutes.(A)

Investor's Business Daily

| January 04, 2006 | COPYRIGHT 2006 Investor's Business Daily, Inc. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan.  All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)Copyright

Byline: KIRK SHINKLE

After 18 months of rising interest rates, the Federal Reserve is offering clear signs that the end is near.

Minutes from the Federal Open Markets Committee's Dec. 13 meeting, where policymakers upped the fed funds rate a quarter-point to 4.25%, show officials drawing a line in the sand for the fate of long-running rate hikes that began in June 2004.

"Some further measured policy firming is likely in coming months," said the minutes, but the number of additional moves needed "probably would not be large."

The Fed played coy at naming the timing of a halt. "Views differed on how much further tightening might be required," said the minutes, which were released Tuesday. "Members thought that the policy outlook was becoming considerably less certain."

Policymakers also said "concerns about near-term inflation pressures had eased somewhat" while Fed staff predicted slower but solid growth in 2006.

Central bankers added that past rate hikes are still impacting the economy and that they "need to be mindful of the lags."

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