US Fed says economic outlook worse than expected

By Agence France-Presse
Wednesday, July 14, 2010 14:46 EDT
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Facing a worse-than-expected outlook for US growth and unemployment, the Federal Reserve has floated the idea of new measures to spur economic recovery, according to minutes published Wednesday.

Details from the Fed’s latest rate-setting meeting, held in June, showed the central bank expected US growth to slow to 3.0-3.5 percent this year, well down from previous estimates.

Noting that the recovery continued at a “moderate pace,” members of the Federal Open Market Committee — which sets interest rates — said that a worsening outlook could prompt debate over further stimulus.

“The committee would need to consider whether further policy stimulus might become appropriate if the outlook were to worsen appreciably,” the minutes said.

The Fed also raised its end-of-year unemployment forecast to 9.2-9.5 percent, predicting the troubled labor market would recover more slowly than expected.

Agence France-Presse
Agence France-Presse
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