See prior post on Fed action [[10’s the Charm?: The Fed raises the rate by 25 basis points to 3.5% [Matrix]]](http://matrix.millersamuel.com/?p=18)
The Fed raised the federal funds 25 basis points for the [11th time since June 2004 [FRB]](http://www.federalreserve.gov/boarddocs/press/monetary/2005/20050920/”).
From Fed press release
Output appeared poised to continue growing at a good pace before the tragic toll of Hurricane Katrina. The widespread devastation in the Gulf region, the associated dislocation of economic activity, and the boost to energy prices imply that spending, production, and employment will be set back in the near term. In addition to elevating premiums for some energy products, the disruption to the production and refining infrastructure may add to energy price volatility.
[The Fed appears to be more concerned about Katrina’s impact on inflation than on economic growth [WSJ].](http://online.wsj.com/article_print/0,,SB112721762582246026,00.html)