Greenspan: No rush to raise rates

FEDERAL Reserve Chairman Alan Greenspan says prospects for the US economy have brightened but has sent a clear signal that the central bank is in no rush to raise interest rates. He told the US Congress that inflation pressures, despite surging oil prices, were well-contained. In his first testimony on the economy since early March, Greenspan sought to assure jittery financial markets that the central bank feels no need to start raising a key interest rate, the federal funds rate, which is at a 40-year low.
'Prospects for low inflation and inflation expectations in the period ahead mean that the Federal Reserve should have ample opportunity to adjust policy to keep inflation pressures contained once sustained, solid, economic expansion is in view,' he told Congress' Joint Economic Committee.
His testimony was in line with the expectations of most economists. They predict the Fed will begin to raise rates but probably not until August, with policy-makers preferring to allow the recovery from the last year's recession to take hold.
Greenspan several times mentioned rising oil prices, but said that unless they rose beyond the recent trading range, the damage to the economy would be limited.
'The US economy has displayed a remarkable resilience over the past six months in the face of some very significant adverse shocks,' he said.
'But the strength of the economic expansion that is under way remains to be clarified. Some of the forces that have weighed heavily on the economy over the past year or so have begun to dissipate, but other factors, such as the sharp increase in world oil prices, have arisen that pose new challenges. As a result, the course of final demand will need to be monitored closely.

Greenspan says low inflation gives Fed time to wait for solid expansion

Federal Reserve board chairman Alan Greenspan said current low inflation gives the FOMC time to wait for a more sustained and solid expansion before raising rates.

"To be sure, over time, the current accommodative stance of monetary policy is not likely to be consistent with maintaining price stability. But prospects for low inflation and inflation expectations in the period ahead mean that the Federal Reserve should have ample opportunity to adjust policy to keep inflation pressures contained once sustained, solid economic expansion is in view," Greenspan said in testimony prepared for the Joint Economic Committee of Congress.

The Fed chairman said although economic prospects "have brightened," the strength of the economic expansion "remains to be clarified."

Rising oil prices and high consumer debt burdens may dampen consumer spending in the months ahead, he said.

Inflation pressures are "largely absent," he said.

Greenspan kann Stärke des US-Aufschwungs nicht bestimmen
US-Notenbankpräsident Alan Greenspan sprach heute vor dem gemeinsamen Wirtschaftsausschuss beider Kammern des Kongresses in Washington. Demnach sei noch unklar, wie stark die Erholung der US-Konjunktur ausfallen wird.


Zwar wartne Greenspan vor negativen Folgen eines dauerhaften Anstiegs der Ölpreise, jedoch gebe es ermutigende Signale für einen Anstieg des privaten Konsums. Die Verbraucherausgaben machen etwa zwei Drittel der US-Wirtschaftsaktivität aus und sind deshalb besonders entscheidend.


Diese Anhörung war mit Spannung erwartet worden. Volkswirte rechneten damit, dass der Fed-Chef eine positive Konjunktur-Entwicklung prognostiziert, und dabei versuchen wird, Erwartungen auf eine Zinserhöhung zu dämpfen. Die nächste Sitzung des für die Geldpolitik verantwortlichen Ausschusses der Fed ist für den 07. Mai anberaumt.



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Die Aussicht für die US-Wirtschaft hat sich "aufgehellt," so Alan Greenspan, Chairman der US-Zentralbank Fed in seiner Rede vor dem Joint Economic Committee. Er sei nicht unter Druck, Zinsen erhöhen zu müssen.

"Das Fundament für konjunkturelle Expansion wurde gelegt," sagte er und gab zu, dass die Fed die Zinsen anheben werde, allerdings habe die Fed mit einer niedrigen Inflation und einem positiven Zukunftsausblick auf die Inflationsentwicklung "genügend Zeit und Möglichkeiten, die Zinspolitik anzupassen (...) sobald Erhöhungen durchgeführt werden, ist eine solide Erholung im Gange."

Die Verbraucherausgaben könnten beeinflusst werden durch die höheren Energiepreise und durch den niedrigeren Lebensstandard. Die Erholung der Investitionen durch die Unternehmen werde "vermutlich schrittweise" sein.