The decision to hold at 2 percent the key short-term federal funds rate — which affects what consumers pay for mortgages, car loans and other credit — brought to a halt a stream of rate cuts since August, reductions that brought the fed funds rate to its lowest level since November, 2004.

The halt signaled concern among policy makers that they might have to reverse course by the end of the year if rising oil prices push up the prices of goods and services across the economy. So far, apart from significant increases in food and energy, that has not happened.

Still, the Fed, in its statement after the meeting, expressed greater concern about inflation than it had after its last meeting in April.

“Although downside risks to growth remain, they appear to have diminished somewhat, and the upside risks to inflation and inflation expectations have increased,” the statement said. “The committee will continue to monitor economic and financial developments and will act as needed to promote sustainable economic growth and price stability.

In the statement, the Fed said that it expected inflation to moderate later this year and next year, but “in light of the continued increases in the prices of energy and some other commodities and the elevated state of some indicators of inflation expectations, uncertainty about the inflation outlook remains high.”

Yet, the statement said: “Labor markets have softened further and financial markets remain under considerable stress. Tight credit conditions, the ongoing housing contraction and the rise in energy prices are likely to weigh on economic growth over the next few quarters.”

The decision was widely expected on Wall Street, where the major stock indexes showed little reaction. An initial spurt just after the announcement quickly dissipated.

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