WASHINGTON — The Federal Reserve yesterday released a forecast for economic growth that shows only a very slight improvement in optimism over what's ahead. Moreover, the Fed is projecting that unemployment will remain above 9% through at least 2010.
Minutes of the central bank's policy meeting show Fed officials remain cautious about any economic recovery, but have begun debating when to start raising short-term interest rates. "Members noted the possibility that some negative side effects might result from the maintenance of very low short-term interest rates," the Fed said in its summary of the meeting, adding officials have chosen to "remain alert."
The Fed is projecting the economy will expand between 2.5% and 3.5% in 2010, and that inflation will remain below 2%.
