Fed: US economy needs more stimulus

22 March 2013

Additional stimulus measures are still required to boost the US economy, despite its recent upturn in performance.

That is according to the Federal Reserve (Fed), which has indicated that the country cannot rest on its laurels in terms of stimulating its recovery, even though the economy has strengthened "moderately" in 2013.

Officials from the central institution held a two-day policy meeting earlier this week and, in a statement issued after this summit, it was announced they had decided to maintain the current monthly programme of purchasing Treasury bonds and mortgage securities worth $85 billion.

This initiative is still deemed necessary as there are clear signs of "downside risks to the economic outlook".

In addition, the Fed noted that it is eager to see evidence of a long-term fall in unemployment in the near future, although it still expects US gross domestic product to expand by between 2.3 per cent and 2.8 per cent in 2013.

By Tony Aynsley

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