A moderate economic recovery in 2010 will push confidence up and ring in a stronger 2011, Federal Reserve Board governor Elizabeth A. Duke said yesterday.
“Combining the various factors likely to influence the path of economic activity this year, including importantly the outlook for financial markets, I expect that the economic recovery will continue at a moderate pace,” Duke told the Economic Forecast Forum in Raleigh, N.C., according to prepared text of her speech released by the Fed.
“As the year goes on, I anticipate that we will see more signs that the improvements in financial markets, credit conditions, and business sales are reinforcing each other, leading to greater confidence and improving the prospects for 2011.”
Providing there are no unexpected changes in the economy, Duke said, “conditions are likely to warrant exceptionally low levels of the federal funds rate for an extended period.” Also, she added, “the Federal Reserve is committed to continue working with banks and bank holding companies to facilitate the flow of credit to consumers and businesses.”
A “wide range of tools” is available for “removing monetary policy accommodation when that becomes appropriate,” Duke said.
