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To: yard_man who wrote (9258)	10/22/1998 3:45:00 PM
From: Cynic 2005	Read Replies (1) \| Respond to of 86076

If each Fed Governor takes different stand. They got all bases covered. -g- Thursday October 22, 3:25 pm Eastern Time (Note: this article is ''in progress''; there will likely be an update soon.) US growth slowing, inflation risk lingers-Broaddus NEW YORK, Oct 22 (Reuters) - The U.S. economy will slow down heading into 1999 as the global economic and financial turmoil takes its toll on the robust pace of expansion seen over the past 2-1/2 years, Alfred Broaddus, president of the Federal Reserve Bank of Richmond, said on Thursday. ''The effect (of the global crisis) on the general economy... so far has been considerably less dramatic than in financial markets,'' Broaddus told the Fed Correspondents Association. ''The downside risk is certainly there and greater than it has been for some time,'' Broaddus pointed out. ''There are good reasons and a strong case to expect U.S. economic activity will decelerate next year,'' the Richmond Fed president added, while citing U.S. Gross Domestic Product (GDP) growth forecasts of 2.0 to 2.5 percent in 1999, down from the 3-3/4 percent average seen from the beginning of 1996 to mid-1998. Broaddus cited four main reasons to base the U.S. slowdown forecast on: -- Japan's recession will continue to weigh on Asia and the rest of the world, slowing down demand for U.S. goods. -- the recent decline in the value of the U.S. dollar will not be sufficient to offset the drag on U.S. exports, -- the decline in the stock market from its high in July ''will probably dampen household confidence,'' -- the recent reluctance for risk taking in U.S. financial markets may have a chilling effect on investments. The Richmond Fed president, however, said the economy has given only limited signs of slowdown so far, such a weaker payrolls and industrial production. ''But consumer spending and business investments have so far held up reasonably well,'' Broaddus stressed. (Note: this article is ''in progress''; there will likely be an update soon.)