Federal Reserve Chairman Alan Greenspan projected optimism in congressional testimony last week - shaking up the financial markets, but at the same time seems to have lowered his expectations for the economy.

"He did lower all his forecasts when you contrast the latest Humphrey- Hawkins testimony with the testimony of last July," noted Lacy H. Hunt, chief economist at HSBC Securities, New York.

"Last July, he predicted 1996 gross domestic product growth of 2.5%, now it is 2.125%, Mr. Hunt said. In addition, Mr. Greenspan raised his unemployment forecast and lowered the inflation forecast. The GDP grew 2.1% in 1995.

"He also said last July that great strength in exports placed the U.S. economy on a solid footing," the economist noted. "This time, he admitted the weakness of our trading partners may undermine exports."

Then, anecdotal economic evidence from the various Federal Reserve districts was "strong," Now, it is "weak," although Mr. Greenspan said that suggested only a "soft patch" for business conditions.

But the Fed chairman's tempered forecast seemed optimistic in relation to the "blue chip" consensus view of business economists, who are projecting slightly lower (2%) growth in economic output this year.

"That may sound like splitting hairs, but it still puts the Fed chairman above consensus," said Mr. Hunt. That impression roiled the markets - on Tuesday in particular - and forced the 30-year Treasury bond back up to a 6.40% yield, versus 6.03% a weak earlier.

In fact, both the consensus view and Mr. Greenspan's forecast assume a rebound in economic strength from current weakness. The consensus assumes lower rates as a major factor, including further easing by the Fed. Is Mr. Greenspan assuming the same?

"I think he did indeed leave the door open for further easing," said Robert G. Dederick, economic consultant to Chicago's Northern Trust Co. "Whether the Fed will go through the door is open to our speculation, of course."

Mr. Hunt, too, expects further easing by the Fed, but in the face of sagging economic performance. He projects GDP growth this year of only 0.5%.

Rather than a "soft patch" in the economic expansion, the economist sees a chain reaction of sorts under way in which income and spending falter and production is reduced. Measured year over year, industrial production was flat in January.

"A pronounced deceleration in per capita income growth has led to a sharp deceleration in the rate of increase in consumer spending - which has led to a precipitous deceleration in the growth rate of manufacturing output," he said.

For Mr. Hunt, the question is whether the Fed's rate reductions will come in time to block a growth recession - in which unemployment rises even as the economic expansion continues - or an outright recession, in which the economy contracts.

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