Central Banks Balance Inflation and Growth

Central banks in three of the world's largest economies, the U.S., U.K., and the Eurozone, are set to decide this week whether to raise lending rates. All three economies are flirting with recession but central banks fear that lowering rates would stoke inflation. Most analysts expect the three banks will hold rates steady until further signals that inflation is cyclical. Second quarter growth in the U.S. was a sluggish 1.9%, despite the fiscal stimulus package. Meanwhile, June consumer prices rose at the fastest rate in 25 years.

Snapshot asks, in the second half of 2008, will growth or inflation dominate central banks' interest rate policy?

Associated Press -Fed Likely to Hold Rates Steady Amid Crosscurrents
Market Watch - Dollar Flat as Traders Eye Central Banks
Bloomberg - Rolling Recessions Bring Paralysis to Bernanke, King, Trichet
Forbes - US Q2 GDP Up 1.9% vs 2.4% Expected Rise