By Barbara Hagenbaugh, USA TODAY

WASHINGTON Â Federal Reserve policymakers increasingly appear poised to keep interest rates untouched for all of 2007 as they express continued concern about inflation in a subpar economy.

In a unanimous vote, Fed officials Wednesday left their target for short-term interest rates at 5.25%. The Fed has left rates alone for seven consecutive meetings after raising them 17 times from 2004 to 2006. Caught between persistent inflationary pressures and a slowing economy  distinct trends with opposite interest-rate prescriptions  Fed officials are expected to keep rates unchanged all year, according to a USA TODAY survey of 53 economists April 20-25. Fed policymakers have not left interest rates unchanged through a whole calendar year since 1993.

IN THEIR WORDS: Read the full statement

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"The Fed is recognizing the economy has slowed down, but they want to sit through this adjustment," says Diane Coe Dercher, chief economist at Waddell & Reed Investment Management. At the same time, "Inflation is a little bit higher than they want to see, but they are not going to overreact."

Says David Kelly, chief economist at Putnam Investments, "It's a perfect recipe for doing nothing."

FIND MORE STORIES IN: Fed : Stocks : Fed Chairman : Ben Bernanke : Inflation : David Kelly

In its statement Wednesday, Fed Chairman Ben Bernanke and his colleagues said, "Economic growth slowed in the first part of this year and the adjustment in the housing sector is ongoing." But they also expressed optimism, saying, "The economy seems likely to expand at a moderate pace over coming quarters."

In language identical to that issued after the previous meeting, in March, the Fed said inflation was "somewhat elevated" and may remain higher than desired. That's in part because low unemployment could stoke wage pressures if workers demand raises. Rising wages can be inflationary if firms increase prices to offset expanded payrolls.

Financial markets added to earlier gains following the widely expected decision. The Dow Jones industrial average rose 53.80 points, or 0.4%, to 13,362.87.

The Fed's decision to stay on the sidelines is good news for borrowers with variable-rate credit cards, home equity lines of credit, car loans and adjustable-rate mortgages. Many of those loans are pegged to the prime rate, which remained at 8.25% Wednesday.

Savers, though, aren't happy. The average yield for one-year certificates of deposit was 3.77% last week. With short-term rates unchanged, CD rates are expected to stagnate or fall slightly, Bankrate.com says.