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Updated Friday, February 5, 2010 10:48 am TWN, Bloomberg

Fed will keep rates on hold until at least Nov.: Totan

TOKYO -- The Federal Reserve will keep interest rates on hold until at least November's mid-term elections in the United States because of the many steps involved in raising borrowing costs, according to Totan Research Co. Policy makers have to progress through three stages before pushing up the benchmark rate from its range of between zero and 0.25 percent, said Izuru Kato, chief market economist at Totan in Tokyo.

They have to signal their intention to raise rates in a Federal Open Market Committee statement, they then have to absorb excess reserves held at the Fed, and finally boost the interest on reserves to push up the Federal Funds rate, he said.

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