WASHINGTON - Despite renewed talk in the bond market that demand for credit may be stirring, there is little reason to worry that stepped-up borrowing will do much to raise interest rates in the next year or so.

That's the latest word from analysts at Merrill Lynch and, given the way some investors have been fretting about Bill Clinton and the federal budget deficit, it is a timely reminder. "The credit markets should easily accommodate prospective credit demands with only limited upward pressure on interest rates," said Bruce Steinberg, manager of macroeconomic analysis, in a market letter.

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