"Going forward, the economy seems likely to expand at a moderate pace." Those dozen words constitute almost the entire difference in the Federal Reserve's policy statement today and the one issued last month. (This statement also downplays energy prices as a source of inflation.) And like last month, the Fed's Open Market Committee decided to leave short-term interest rates alone.
But those 12 words are full of meaning and import going forward. For starters, their addition to today's statement means there's scant doubt that the Fed is more worried about higher inflation than lower growth. So you probably won't be seeing much talk about potential rate cuts. Indeed, the econ team at Bear Stearns thinks the Fed is "signaling that a rate cut in the foreseeable future is very unlikely."
Those 12 words also indicate that whatever the housing slowdown is doing to the value of your house, Bernanke & Co. don't think it's infecting the rest of the economy right now. You can probably give gas prices a big dollop of credit for that. Goldman Sachs figures that the "cumulative boost to real household income is likely to total $90 billion (annualized)." Not a bad tax cut for American consumers.