Fed Lowers Growth Forecasts

The Federal Reserve issued a new forecast for the U.S. economy Wednesday, and it’s gloomy, with little chance of growth. The negative prediction for the next two years includes the assessments that the economy will increase only 2.9 percent at most in 2012 and 3.5 percent at most in 2013. Unemployment is predicted to hover above 8.5 percent at the end of 2012 and 7.8 percent toward the end of 2013. These predictions are much lower than the previous projections, released in June. More troubling, the Fed is not introducing new measures to stimulate growth. It does admit, however, that growth has “strengthened,” but strains in global markets have helped lead to a negative outlook.