UPDATE 3-Fed lowers growth forecast, raises inflation

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* Fed sees slower growth, higher inflation in 2008 than three months ago

* Fed signals unlikely to cut rates even if economy slows

* Fed says cutting rates April 30 was "close call"

By Mark Felsenthal and Glenn Somerville

WASHINGTON, May 21 (Reuters) - The Federal Reserve on Wednesday slashed its U.S. economic growth forecast for 2008 and signaled that mounting concerns over inflation would make further interest rate cuts unlikely.

"Several members noted that it was unlikely to be appropriate to ease policy in response to information suggesting that the economy was slowing further or even contracting slightly in the near term," the Fed said in minutes from its April 29-30 policy meeting.

Fed officials said that cutting benchmark interbank lending rates by a quarter percentage point to 2 percent at their last meeting was "a close call," reinforcing the impression that policy-makers may be putting further interest rate moves on hold.

"If you had any doubt that the Fed is signaling a pause, that doubt is gone," said Christopher Low, chief economist at FTN Financial in New York.