The U.S. Federal Reserve (Fed) announced a decline in its growth forecasts for the U.S. economy in 2009 and 2010.
Wednesday 20 May the Fed has lowered the GDP growth for the next three years, although a slight recovery is expected in the second half of 2009. For this year, it anticipates a reduction of between 2% and 1.3%, whereas in January it expected a decline of between 1.3% and 0.5%.
In 2010, the Fed sees GDP growth of 2% to 3%, and in 2011 from 3.5% to 4.8%. Slightly lower than those announced four months ago. The economic outlook of the members of the Monetary Policy Committee of the Fed (FOMC) meet the diagnosis of its chairman, Ben Bernanke. He foresaw a slow recovery in 2010, but a continuing rise in unemployment across the Atlantic.
The FOMC elaborates figures: the unemployment rate, currently 8.9%, the highest in twenty-five years could reach up to 9.6% in 2009 and still 8.5% in 2011, well over the long term goal of the Fed, between 4.8% and 5.0%. Regarding inflation, the Fed believes that it should be between 0.6% and 0.9% this year. Overall, "most" of the FOMC members believe that the economy should not be in line with its objectives of growth, unemployment and inflation in the long run for five or six years.
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