Announcements by the Federal Reserve Board can influence a consumer’s cost of living, but it’s tough for laymen to understand what the announcements mean. Here’s a plain-language translation of what the Fed’s key rate-setting committee said in its Jan. 30 announcement.

The Fed said:
The Federal Open Market Committee decided today to keep its target for the federal funds rate unchanged at 1-3/4 percent.

What that means:
The Fed’s rate-setting committee will keep enough cash in the banking system to keep banks’ overnight lending rate at 1.75 percent.

The Fed said:
Signs that weakness in demand is abating and economic activity is beginning to firm have become more prevalent. With the forces restraining the economy starting to diminish, and with the long-term prospects for productivity growth remaining favorable and monetary policy accommodative, the outlook for economic recovery has become more promising.

What that means:
If this were a weather report, we would say that the outlook for the economy is partly sunny. Not partly cloudy. Not sunny. Certainly not cloudy. Yes, we’d say the forecast is partly sunny, with great picnic weather coming.

The Fed said:
The degree of any strength in business capital and household spending, however, is still uncertain. Hence, the Committee continues to believe that, against the background of its long-run goals of price stability and sustainable economic growth and of the information currently available, the risks are weighted mainly toward conditions that may generate economic weakness in the foreseeable future.

What that means:
We don’t know if consumers are going to keep spending (they’re deep in debt) and when businesses are going to start spending again. We’re worried that people and businesses might tighten their purse strings, and we will cut interest rates again if that’s the best way to encourage spending. We’re not worried about inflation. (This is the carefully watched key paragraph that signals which way the Fed is leaning in its rate policy.)