WASHINGTON — Consumer confidence rebounded slightly in August, though remaining subdued, as energy prices moderated and Americans became a bit less pessimistic about the longer-term outlook.

The New York-based Conference Board's Consumer Confidence Index rose to 56.9 from 51.9 in July, which had been a 16-year low. The increase was better than economists predicted. Still, sentiment is far from rosy.

"The economy remains stuck in neutral, but may be showing signs of improvement by early next year," said Lynn Franco, director of the Conference Board Consumer Research Center.

While consumers were feeling a bit less gloomy, the Federal Reserve was reducing its growth forecast and betting a slowing economy would reduce inflationary pressures.

According to minutes of an Aug. 5 Fed meeting released yesterday, central bank staff economists cut their forecast for economic growth in the second half of 2008 and into 2009. The staff expects subpar growth until the second half of next year, when housing and financial markets should stabilize.

Central bank officials at the meeting voted to hold a key interest rate steady at 2 percent to support the faltering economy. Though the rate, a benchmark for pricing many consumer and business loans, is relatively low, most Fed officials did not see the policy as especially inflationary, the minutes say. That's because financial markets remain constricted, increasing the cost of borrowing and cutting the availability of credit.

Fed officials generally expect their next move will be a rate increase, though the "timing and extent" depend on the economy, the minutes say.

They also underscore deep splits within the Fed, as some officials worry inflation could increase more than expected unless they raise rates "sooner than currently anticipated." Dallas Fed President Richard Fisher dissented at the meeting, arguing the central bank should be increasing rates to reduce price pressures.

U.S. wholesale inflation surged in July at the fastest year-over-year pace in nearly 27 years. Consumer inflation is up 5.6 percent in the past 12 months. Fed Chairman Ben Bernanke last week said declines in oil and other commodity prices should reduce price pressures.

Goldman Sachs economists, in an advisory to clients, said they expect the Fed to sit tight on rates "for the foreseeable future."