BATON ROUGE, La. -- The U.S. economy has been showing signs of strength that should lead to sustained growth but at a slow pace, two Federal Reserve bank presidents said.
The regional Fed presidents, Robert Black of Richmond and Robert Forrestal of Atlanta, also said that the central bank remains committed to curbing inflation and that the chances of a "false start" recovery have been diminishing.
"I think we have a highly committed group of people that are concerned about inflation," Mr. Black said. "They see curbing inflation as the best route to getting the economy on track."
Mr. Black and Mr. Forrestal made the comments to Reuters after participating in a panel discussion at Louisiana State University during a session of the Graduate school of Banking of the South.
Robert McTeer, president of the Dallas Federal Reserve Bank, also participated in the panel and repeated his comments from a week earlier that the economy is recovering, but that growth will be slow.
Mr. Forrestal said he expected gross domestic product to growth about 2% this year and the consumer price index to rise about 3%.
"I think there is a reasonable chance that we are on the path to sustained growth," Mr. Forrestal said.
"There's always the possibility of a false start, but I think the odds of that happening are diminishing," he said.
Mr Forrestal also said the economy has been improving in part due to "some balance sheets undergoing repair."
Mr. Black said the economy has been recovering at a "moderate pace," but the recovery will not be "fast." He also said recent economic data has been encouraging but still need to improve.
"We have been getting some better figures, but not as good as I would like," Mr. Black said.
Mr. McTeer said concern about recent sluggishness in the M2 money supply was unwarranted. He said the trend was caused in part by consumers cashing in certificates of deposit and that the money has been invested in the economy by spending or by other investments.