America's central bank sent a clear message this week. For the second consecutive meeting,

the Federal Open Market Committee, the central bank's policy-making committee, left short-term interest rates unchanged at 1.75%. But it said that the risks facing the economy had shifted from economic weakness to a balance between weakness and excessive growth. This shift surprised no one. But it has convinced many people that interest rates are set to rise again—and soon.

Judging by prices in futures markets, investors are betting that short-term interest rates could start rising as early as May, and will be 1.25 percentage points higher by the end of the year. That may be excessive. Economists at Goldman Sachs, who long argued that the central bank would do nothing this year, now expect short-term rates to go up only 0.75% this year, starting in June. But virtually everyone reckons some Fed tightening is in the future.

The reason？ After an unprecedented 11 rate-cuts in 2001, short-term interest rates are abnormally low. As the signs of robust recovery multiply, analysts expect the Fed to take back some of the rate-cuts it used as an "insurance policy" after the September 11th terrorist attack. But higher rates could still be further off, particularly if the recovery proves less robust than many hope. The manufacturing sector is growing after 18 months of decline. The most optimistic Wall Streeters now expect GDP to have expanded by between 5% and 6% on an annual basis in the first quarter.

But one strong quarter does not imply a sustainable recovery. In the short term, the bounce-back is being driven by a dramatic restocking of inventories. But it can be sustained only if corporate investment recovers and consumer spending stays buoyant. And since consumer spending held up so well during the "recession" it is unlikely to jump now.

These uncertainties alone suggest the central bank will be cautious about raising interest rates. That caution is all the more necessary given the lack of inflationary pressure. Although America's consumer prices have stopped falling on a monthly basis, the latest figures show few signs of nascent price pressure. Indeed, given the huge pressure on corporate profits, the Federal Reserve might be happy to see consumer prices rise slightly. In short, while Wall Street frets about when and how much interest rates will go up. The answer may well be not soon and not much.

Some people expected short-term interest rates to jump soon because they ______.

A．strongly believed in economic recovery.

B．took for granted economic expansion.

C．were cautious in their excessive investment.

D．had doubts about the effects of price pressure.