(MENAFN- Qatar News Agency) Shington june 19 (qna) - the federal reserve on wednesday downgraded its outlook for the us economy this year but forged ahead with the phase-out of its signature stimulus program.
the nation's central bank lowered its forecast for growth this year to between 2.1% and 2.3% down from its previous prediction of nearly 3%.
the mediocre expansion is primarily the result of a disastrous winter in which the economy actually shrank by 1%. though the recovery has picked up speed since then it is unlikely to make up all of its lost ground. the fed kept its estimate of the rate of growth next year unchanged at 3% to 3.2%.
"economic activity is rebounding in the current quarter and will continue to expand at a moderate pace thereafter" fed chair janet yellen said in a press conference wednesday after the central bank's regular policy-setting meeting in washington.
that description of the nation's economic situation is stronger than the one given after the fed's last meeting in april – and enough to convince officials to continue scaling back support for the economy. the fed has bought more than $1 trillion in long-term bonds over the past year and a half in an effort to bring down long-term interest rates. since january it has slowly reduced its purchases at every meeting. the fed voted unanimously to cut them by another $10 billion on wednesday bringing the amount of monthly purchases to $35 billion. (qna)
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