Fed officials: Key rate wasn't too low

Even as they grappled with inflation worries, most Federal Reserve officials at their August meeting didn't believe the Fed's key interest rate was too low given harder-to-get credit conditions straining consumers and businesses alike.

Documents, released Tuesday, provided insight into the Fed's thinking at the Aug. 5 meeting, when central bank policymakers decided to hold its key rate steady at 2 percent for the second straight meeting. Confronted by problems at every turn -- rising unemployment, shaky growth, credit troubles and creeping inflation -- the Fed took a gamble that once again the best move was none at all.

"Most members did not see the current stance of policy as particularly accommodative, given that many households and businesses were facing elevated borrowing costs and reduced credit availability" due to fallout from financial market strains and economic problems, the Fed's documents stated.