The Federal Reserve Bank's Open Market Committee left the target federal funds rate at 5.25 percent this afternoon.

"Recent indicators have suggested somewhat firmer economic growth," the Fed said in a statement, "and some tentative signs of stabilization have appeared in the housing market. Overall, the economy seems likely to expand at a moderate pace over coming quarters."

Ever cautious, the Fed noted that the the risk of inflation is still present given the economy's "high level of resource utilization," which could lead it to raise rates as 2007 progresses.