November 24: Fed sees slow recovery holding jobless rate high

Source: Marketwatch

Washington -- Federal Reserve officials believe the recovery is going to expand at a slow rate while unemployment will continue to remain high, according to the minutes of their closed-door Nov. 3 and Nov 4 meeting released Tuesday. The Fed forecast that the U.S. unemployment rate could stay elevated in 2010 in the range of 9.3% to 9.7% and would only drop modestly to 8.6% in 2011, according to the summary of the latest meetings. The unemployment rate hit 10.2% in November, a 26-year high. The Fed forecast in June that the unemployment rate could hit a range of 9.5% to 9.8% in 2010 and 8.8% in 2011 in a slightly more negative projection.

Federal Reserve officials held a wide variety of opinions about the economic outlook and the central bank's policies at the November meeting. At the end of its meetings, the Fed decided to keep interest rates at record lows. As expected, the Fed kept its target for its federal funds rate set at a range of zero to 0.25%. The votes for these policy actions were unanimous. Most members forecast that the unemployment rate would remain quite elevated over the next couple of years while the level of inflation remained below the central bank's objective levels. See full story.