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Strategies & Market Trends : Trend Setters and Range Riders -- Ignore unavailable to you. Want to Upgrade?

To: Connor26 who wrote (12909)	2/27/2002 11:21:08 PM
From: Susan G	Respond to of 26752

Here's the details on what Greenspan said today Connor... Fed Cuts/Forecast -2: Recovery Expected To Begin In '02 27 Feb 10:08 By Rebecca Christie Of DOW JONES NEWSWIRES WASHINGTON (Dow Jones)--The Federal Reserve Board on Wednesday lowered its expectations of U.S. economic growth this year, saying the nation's economy has begun to recover but is not yet on track to make full use of its potential. In a semiannual report to Congress, the central bank said the "central tendency" of its top policymakers calls for the U.S. gross domestic product to expand by 2.5% to 3% between the fourth quarter of 2001 and the fourth quarter of 2002. That marks a decrease from the forecast of 3% to 3.25% growth the Fed made last July. "Federal Reserve policymakers are expecting the economy to begin to recover this year from the mild downturn experienced in 2001, but the pace of expansion is not projected to be sufficient to cut into the margin of underutilized resources," the Fed said in its report. The economy, which slipped into recession for the first time in a decade last March, grew just 0.1% last year - well below the Fed's forecast of 3.5% to 4.5%. Most private-sector forecasters expect the economy to rebound quickly this year. The Fed's top policymakers indicated in their report to Congress that inflation won't be a serious danger as the economy recovers. Inflation, measured by the price index for personal consumption expenditures, should be about 1.5% in 2002, they said, revising their preliminary estimate of 1.75% to 2.5%. The unemployment rate, however, is likely to be higher than previously thought, the Fed said. They predicted the unemployment rate will average 6% to 6.25% in the fourth quarter of 2002. That's up from an initial estimate of 4.75% to 5.25%. -By Rebecca Christie, Dow Jones Newswires; 202-862-9249; rebecca.christie@dowjones.com