WASHINGTON (AP) – The Federal Reserve kept interest rates steady yesterday, giving holiday shoppers a reason for some cheer. However, the Fed held back an extra gift Wall Street was hoping for: a signal that rates might actually be lowered soon.

Wrapping up their last meeting of the year, Fed chairman Ben Bernanke and all but one of his central bank colleagues agreed to leave an important rate unchanged at 5.25 percent, the fourth straight meeting without budging the rate.

That meant commercial banks’ prime interest rate – for certain credit cards, home equity lines of credit and other loans – stayed at 8.25 percent, once again giving a break to borrowers who until this summer had endured the pain of two-plus year of rate increases.

“The Fed is not acting like the Grinch this Christmas. But it is not putting presents in anyone’s stocking, either,” said Mark Zandi, chief economist at Moody’s Economy.com.

On Wall Street, stocks dipped as disappointed investors failed to get a sign that the Fed was moving toward cutting rates. The Dow Jones industrials lost 12.90 points to close at 12,315.58.

Discussing economic conditions, Fed policymakers said growth has slowed over the course of the year, partly reflecting a “substantial cooling” of the housing market. That description went beyond the Fed’s previous assessment in late October and suggested a sharper slump in housing was taking place.

Nonetheless, policymakers stuck with their previous judgment that the economy probably will expand at a moderate pace in coming quarters. This time they hedged their assessment a bit and noted that recent economic barometers have been mixed.

Analysts viewed the Fed’s characterization of the economy’s growth prospects as slightly weaker than at the previous meeting in late October.

Still, the Fed didn’t hint that it would actually cut rates any time soon as some Wall Street investors would like.

Instead, it once again kept open the possibility of a rate increase if inflation should show signs of flaring up. “Some inflation risks remain,” policymakers said. “The extent and timing of any additional firming that may be needed” to address these risks would hinge on economic reports, they said.

For the fourth meeting in a row, Jeffrey Lacker, president of the Federal Reserve Bank of Richmond, Va., was the lone dissenter. Lacker said he would have preferred that the Fed boost interest rates by one-quarter percentage point.

Looking ahead, few economists believe the Federal Reserve will boost rates. The Fed itself is betting that slower economic growth will eventually lessen inflation pressures.

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