MINNEAPOLIS -- The U.S. economy will post a moderate growth rate in 1992 of about 2% to 3% in gross domestic product, said Minneapolis Federal Reserve Bank president Gary Stern.

"I would classify that as the end of the recession," Mr. Stern said last week at a meeting with reporters.

"The jury is out whether the fourth quarter is going to be up or down," the Fed president said.

But signs of economic growth in the quarter are expected to continue into the new year.

He said what he characterized as "modest recovery" will not lead to significantly higher inflation.

"We are moving to a more durable environment of lower inflation," he said, adding that the Fed can take action to prevent any resurgence.

Mr. Stern said there were signs some economic indicators had bottomed in 1991. "Orders for durable goods bottomed out early in the year and improved from there," he said.

Housing hit a low roughly in January 1991 and consumer spending also scraped bottom this year, he added.

"I don't think 1991 turned out to be all that different from what we expected," Mr. Stern said. "I think 1992 is going to [see] modest expansion."

Mr. Stern said the nation is grappling with an ample supply of autos and housing produced in the 1980s and an excess supply of commercial construction.

The Midwest economy fared better than other parts of the nation.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.