Interest rates likely to rise

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Tuesday, June 29, 1999 | 11:44 a.m.

NEW YORK -- Reports of rising consumer confidence but weakening home sales provided mixed signals of the economy's trajectory today as Federal Reserve policy-makers began a two-day meeting to set targets for interest rates.

The central bank's Federal Open Market Committee, which was meeting behind closed doors in Washington, was widely expected to boost interest rates in a bid to cool off the economy and prevent inflation from rekindling.

The Conference Board, a business-funded research group, reported that its consumer confidence index rose in June to its highest level in more than 30 years, signaling even stronger economic growth ahead. But the Commerce Department said sales of new homes fell 5.1 percent in May -- double what analysts had expected.