RICHMOND, Va. -- Richmond Federal Reserve President Robert P. Black predicts the economic recovery in the United States will not falter this year, but will be moderate at best.

"The best guess is that the upswing . . . is probably going to continue and we will not have a triple dip," Mr. Black said.

"The safest prediction is that we will have 3% or so growth in real gross domestic product in the next several years."

He predicted that inflation would not accompany the recovery, a view not shared by other experts.

Era of Stability Foreseen

"I would argue that if, in fact, we get prices down to a lower level, with less inflation, then we've probably got a potential that is greater than anything we've seen in the past because we haven't had a long period of stable prices," Mr. Black said.

Fed board members are "more aware of the dangers of inflation and are more inclined to move to combat it before it gets out of hand," he said.

Mr. Black's optimism on inflation also stems from what he views as a leaner business environment and increasingly stiff foreign competition.

He said he expect moderate strength in housing, "although it has zigzagged back and forth."

Inventories in 'Good Shape'

Mr. Black expects a growing push for the economy from capital investment, particularly from producers of durable equipment: "I think we can expect a steady improvement as people try to modernize."

He also predicts some rebuilding of inventories. "Inventories by and large are in pretty good shape in terms of what sales are doing," he said.

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