Fed Says Economy May Be Rebounding
WASHINGTON (AP) _ The weak U.S. economy, which has suffered thousands of job losses in recent months, may be on the verge of a rebound now that the Iraq war is over, the Federal Reserve said Wednesday.
The central bank said that four of its 12 districts _ Dallas, Kansas City, New York and Minneapolis _ detected signs of increased economic activity and no district reported further deterioration since the last report in late April.
``The unwinding of war-related concerns appears to have provided some lift to business and consumer confidence, but most reports suggest that the effect has not been dramatic,″ the central bank said in its latest survey of business conditions.
The central bank cautioned against reading too much into the scattered signs of a rebound, describing overall activity in many districts as still ``sluggish, subpar or subdued.″
The survey of business conditions, known as the beige book for the color of its cover, will be used by Fed policy-makers when they meet June 24-25 to set interest rates.
Many analysts are convinced that the Fed will cut rates for a 13th time at that meeting in an effort to make sure that the current weak patch the country is going through does not deepen into something worse such as another recession.