“Despite a lull in economic growth and anxiety about the effect of high oil prices on spending, the Federal Reserve is expected to continue its strategy of gradually raising interest rates when policy makers meet next Tuesday,” writes Edmund Andrews in today’s New York Times.

“A raft of indicators suggest that economic growth slowed sharply last quarter, particularly in June, and may continue to be sluggish for a few more months. But Fed officials and many outside economists predict that the lull will be temporary and that activity will pick up again by the fall.”

“On Wednesday, the Commerce Department released new data on orders for manufactured products that in many ways reinforced the signs of sluggish growth.”

“But the economic picture is not clear and other indicators point to a renewed step-up in growth. Consumer confidence is back at high levels, and automobile sales last month jumped to an annual rate of 17.3 million cars and trucks from a rate of just over 15 million vehicles in June.”

“The most important evidence on the economy’s recent pulse will be released at the end of this week. And while Fed officials will scrutinize that data on the job market’s July performance, to be announced Friday by the Labor Department, most analysts believe central bankers are committed to raising the federal funds rate on overnight loans between banks by a quarter-point, from 1.25 to 1.5 percent.”

“Fed policy makers are scheduled to meet four times before the end of the year and unless the economy shows clear signs of further slowing, they are expected to keep raising rates at each of those sessions. And the process will probably not end there.”

” ‘The ebb and the flow of data is less important than it would otherwise be,’ ” said Laurence H. Meyer, a former Fed governor. The main reason, he said, is that Fed officials know that short-term interest rates are still so far below normal – adjusting for inflation, they are actually negative – that they would eventually lead to rising prices if left unchanged. ” ‘It is almost as if you close your eyes,’ ” Mr. Meyer added, ” ‘until you get rates back up to about 2 percent.’ ”

“All of that leaves the Federal Reserve with almost the opposite challenge it faced just two months ago. Back then, Fed officials were fending off critics who complained that they were ignoring signs of looming inflation. Now officials are arguing that the recent deceleration in growth is temporary, too.”

“Alan Greenspan, the Fed chairman, went out of his way last month to brush off weak growth in jobs and consumer spending as a ‘soft patch’ that ‘should prove short-lived.’ ”