US growth lower, but seen positive

Sep 28 | Updated: Sep 29 2007, 09:49am hrs
Federal Reserve Bank of Atlanta president Dennis Lockhart said the economy is likely to slow, while avoiding a recession, with an extended recession in housing posing a threat to consumer spending.

The current Fed policy abets a flight path of lower but still positive growth, with moderate inflation, Lockhart said at in remarks prepared to Middle Tennessee State University in Murfreesboro, Tennessee. More turbulence may be ahead. Lockhart said the Feds September 18 interest-rate cut was a tactical move to reduce the risks facing the economy from the rout in financial markets that gathered momentum in August. Market conditions are now improving, with little sign of businesses being unable to borrow and a likelihood of finding balance in coming months, the Atlanta Fed chief said.