The Federal Reserve reduced its forecast for economic growth this year on Wednesday, but gave the recovery a vote of confidence by further cutting the stimulus program it has had in place since the recession.
The Fed said it expects the economy to expand at a pace between 2.1 percent and 2.3 percent in 2014, down from its previous forecast of around 2.9 percent. The economy slowed considerably in the first quarter, although many economists expect growth to pick up later in the year.
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The Fed committee that sets interest rate policy voted to reduce its monthly bond-buying program by $10 billion to $35 billion a month, less than half of what it was last year. It held interest rates unchanged near zero.
"Information received since the Federal Open Market Committee met in April indicates that growth in economic activity has rebounded in recent months," the Fed said in a statement. It said that the labor market showed further improvement and household spending rose moderately. Fiscal policy continued to hold back growth, it said, but that obstacle to the recovery was shrinking.
First published June 18 2014, 11:26 AM
Patrick J. Rizzo
Patrick Rizzo is the business editor for NBC News Digital. He started this role in November of 2008. Rizzo is responsible for NBC Newsâ€™ coverage of the economy and business.
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Rizzo joined NBCNews.com from The Associated Press, where he was economics editor. In that role, Rizzo was responsible for the APâ€™s coverage of the economy, particularly the dual U.S. housing and financial crisis and the Great Recession.
Prior to The AP, Rizzo was at Reuters, where he spent 18 years covering a wide range of general news and business stories.
Rizzo lives in New York City, with his wife Kathryn Lu and his two children, Dylan and Alessandra.