Fed Lowers Growth Forecast

Submitted by Ronald Tennant with Metrocities Mortgage:

Montreal Gazette (05/22/08)
Further interest rate cuts are unlikely due to growing concerns about inflation, according to the Federal Reserve. "Several members noted that it was unlikely to be appropriate to ease policy in response to information suggesting that the economy was slowing further or even contracting slightly in the near term," the central bank says in the minutes of its April 29-30, 2008, monetary policy-setting session. Moreover, lowering benchmark interbank lending rates by one-quarter of a percentage point to 2 percent was considered "a close call." On May 21, the Fed revised its U.S. economic growth forecast downward to a range of 0.3 percent to 1.2 percent for 2008, compared with growth of 1.3 percent to 2 percent that it projected three months ago.