WASHINGTON (Reuters) – Ground-breaking economic projections from the U.S. Federal Reserve on Wednesday show a central bank braced for a painfully slow recovery, suggesting the possibility of a new round of bond buying remains alive if growth were to flag.
But the forecasts also show a wider range of views at the Fed than voting patterns at its policy meetings have shown, suggesting a vigorous debate among policy makers in months to come.
WASHINGTON (Reuters) – The Federal Reserve on Wednesday said it will likely not raise interest rates until at least late 2014, much later than it had said previously, as it nurses a still-sluggish economic recovery.
The Fed, after a two-day policy meeting, repeated its view that the economy faces “significant downside risks” but if offered little to suggest it was close to launching another round of bond-buying to prop up growth.
WASHINGTON (Reuters) – The Federal Reserve has launched a potentially controversial push to revive the battered U.S. housing market, calling on other government officials to act after largely exhausting its own tools to support the fragile economic recovery.
After the Fed slashed interest rates to near zero more than three years ago and amassed $2.3 trillion in bonds to spur growth, the U.S. economy showed some momentum toward the end of 2011. But many analysts are doubtful the recovery will achieve take-off velocity in 2012 and housing is one of the biggest drags.
WASHINGTON (Reuters) – The Federal Reserve could take the historic step this week of announcing an explicit target for inflation, a move that would fulfill a multi-year quest of the central bank’s chairman, Ben Bernanke.
An inflation target would be the capstone of Bernanke’s crusade to improve the Fed’s communications, an initiative aimed at making the central bank more effective at controlling growth and inflation. It would, at long last, bring the Fed into line with a policy framework used by most other major central banks.
LOUIS (Reuters) – Two top Federal Reserve officials, including a policy centrist, said on Friday the central bank should hold off buying more bonds to boost growth given a strengthening in the economy.
“The data has been stronger in recent weeks and months, and so I think there’s probably a good case to stand pat for now,” St. Louis Federal Reserve Bank President James Bullard told reporters after a speech here.
WASHINGTON, Jan 9 (Reuters) – The Federal Reserve has
launched a potentially controversial push to revive the battered
U.S. housing market, calling on other government officials to
act after largely exhausting its own tools to support the
fragile economic recovery.
After the Fed slashed interest rates to near zero more than
three years ago and amassed $2.3 trillion in bonds to spur
growth, the U.S. economy showed some momentum toward the end of
2011. But many analysts are doubtful the recovery will achieve
take-off velocity in 2012 and housing is one of the biggest
CHICAGO (Reuters) – Signs the U.S. recovery is gaining strength suggest the Federal Reserve may not need to buy any more bonds to spur growth, a top policymaker said on Saturday.
“I don’t think it’s very likely right now because the tone of the data has been pretty strong” through the end of 2011 and up to now, St. Louis Fed President James Bullard told reporters after a speech at an economics conference. “We can probably wait and see for now.”
CHICAGO (Reuters) – The World Bank will recommend reforms to China’s domestic financial system as part of broader proposals to help wean the country from a dependence on exports to sustain economic growth, World Bank President Robert Zoellick said on Saturday.
Those changes could have the benefit of increasing confidence among Chinese authorities that the nation’s economy will not be destabilized by foreign exchange reforms, Zoellick said. U.S. and other international authorities have long urged China to let its yuan currency, also called the renminbi, to float more freely on foreign exchange markets.
Protests against Wall Street and the U.S. financial system are hanging over an annual gathering of economists and social scientists in Chicago. Yale economist Robert Shiller offered two cheers for capitalist finance, saying that while the U.S. free market system has contributed to higher living standards, the vehemence of the recent public outcry points to a need for greater democratization. This is how he put it in a speech:
Occupy Wall Street … was something that in some sense you could see coming. I think we have increasing concerns about inequality, which is getting worse, about the distribution of power.
WASHINGTON (Reuters) – The U.S. government-run mortgage finance firms Fannie Mae and Freddie Mac could play a bigger role in turning around the battered U.S. housing market, the Federal Reserve told Congress, a call that looks set to run into stiff political opposition.
The Fed, in a paper sent to lawmakers on Wednesday, outlined an array of steps that could be taken to help the housing sector, including allowing Fannie and Freddie to provide cheaper mortgages to a broader pool of homeowners.