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To: DiB who wrote (2056)	9/23/1998 2:38:00 PM
From: Scarecrow	Respond to of 19700

Here's an early glimpse at the answer from Reuters at 2:28 today: Federal Reserve Chairman Alan Greenspan said Wednesday global financial turmoil would be more than enough to curb U.S. inflation, the strongest indication yet he may be considering an interest rate cut. In eagerly awaited testimony to the Senate Budget Committee, Greenspan noted that the economic situation had deteriorated considerably since the U.S. central bank's policymaking committee last met on Aug. 18. ''By mid-August the committee believed that disruptions abroad and more cautious behavior by investors at home meant that the risks to the expansion had become evenly balanced,'' Greenspan said in his prepared testimony. ''Since then, deteriorating foreign economies and their spillover to domestic markets have increased the possibility that the slowdown in the growth of the American economy will be more than sufficient to hold inflation in check,'' he added. The U.S. central bank has held back from cutting interest rates because of tight labor markets, fearing an upsurge in inflation was a bigger risk than the drag on the economy caused by the global financial crisis. U.S. official rates have been unchanged since March 1997. But Greenspan, speaking days ahead of the Fed's Sept 29 monetary policy meeting, emphasized in his testimony that the world's financial problems were far from over and policymakers needed to be sensitive to the crisis. ''There is little evidence to suggest that the contagion has subsided,'' he said.