U.S. Federal Reserve cuts 2014 growth outlook for economyUpdated: 2014-06-19 22:02:46 KST
The U.S. Federal Reserve has given a positive outlook for the economy this year
even though the economic growth forecast was slashed.
From a projection of 2.9 percent in March growth has been cut to between 2.1 and 2.3 percent.
This is the latest from the two-day meeting of the Federal Reserve's policymakers.
At a press conference on Wednesday, Fed Chair Janet Yellen however expressed the U.S. economy is rebounding and said interest rates currently near zero could begin to rise sometime next year.
If this happens, it'll be the first rate hike since 2006.
The exact timing, though, apparently depends--
"There is no mechanical formula for what a considerable time means. The answer is it depends. It depends on how the economy progresses."
And as widely expected, the Fed cut its monthly bond purchases by another 10-billion U.S. dollars to 35 billion, which shows confidence of a recovering economy.
The Fed, in the meantime, will keep a watch on economic stability.
"Yellen came out and said that volatility may be too low and we agree. Bond market volatility is very low. Stock market volatility is very low. So any sudden spike in volatility could cause interest rates to rise sharply."
Growth projections for 2015 and 2016 have been maintained and Fed officials do forecast a drop in unemployment.
Connie Lee, Arirang News.
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