The Federal Reserve has once again pared its plans for raising interest rates, citing the weakness of the global economy as a reason for greater caution about the prospects for domestic growth, The New York Times reported yesterday. The Fed’s policy-making committee voted not to raise its benchmark rate, although general expectations at the beginning of the year were for an increase this month. It also pulled back sharply from a December prediction that the rate would rise by one percentage point this year. Fed officials now expect to raise rates by just half a percentage point this year. Fed Chair Janet L. Yellen said that the central bank remained relatively optimistic about the domestic economy, which she said had shown no signs of damage from the wobbles of financial markets or from weak global growth. But she said that prudence dictated caution. The Fed entered the year planning to raise its benchmark rate about one percentage point, most likely in four quarter-point increments. Officials backed away from those plans after financial conditions tightened in January because of concerns about the health of the global economy.
