Fed Keeps Heat On

Updated from 2:22 p.m. EDT

The Federal Reserve raised official interest rates by another 25 basis points Thursday and, while keeping up its anti-inflation rhetoric, said it will continue to base future monetary policy on its interpretation of incoming economic data.

The quarter-point hike, the Fed's 17th in as many meetings, lifts the fed funds rate to 5.25% -- its highest level since March 2001. Back then, Alan Greenspan's Fed was in the process of unwinding a tightening campaign that took the benchmark lending rate as high as 6.5% in May 2000.

Policymakers retained their "data dependent" approach to future policy in the statement accompanying Thursday's decision, saying that while "economic growth is moderating," inflation risks remain. ...