The Federal Reserve on Tuesday raised its outlook for US economic growth in 2010 to a range of 2.5 to 3.5 percent, and said the troubles in unemployment appeared to be near a peak.
In a new forecast accompanying minutes from the Fed's policy meeting November 3-4, the central bank said participants "anticipated that economic recovery would be gradual, with real gross domestic product (GDP) growing at a moderate pace and the unemployment rate declining slowly over the next few years."
The range for 2010 growth was boosted slightly from a July projection of between 2.1 and 3.3 percent.
The new forecast also suggests that unemployment, which hit 10.2 percent in October, could ease in early 2010.
The economy is not growing as fast as the government first thought and the recovery still faces significant obstacles, including households nervous about spending and rising unemployment.
Economists expect new reports Wednesday to give a better picture of how things are shaping up for the final three months of the year.
New filings for unemployment benefits likely will show a slight improvement while consumer spending should post a rebound in October after an auto-related plunge in September. Sales of new homes are expected to grow, propelled by first-time buyers taking advantage of a special tax credit.
Even with signs of strength, economists worry the recovery could falter if consumer spending, which makes up 70 percent of economic activity, drops in the face of unemployment that is already at the highest point in 26 years and is expected to keep rising. Read More
For consumers, the health care bills taking final shape in Congress don't rate close to a perfect 10.
The Democratic measures would leave 12 million or more eligible Americans uninsured. Many middle-class families who'd now be required to buy coverage would still find the premiums a stretch, even with government aid. A new federal fund to provide temporary coverage for people with health problems would quickly run out of cash.
For now, these bread-and-butter concerns take a back seat to more pressing issues for Democratic lawmakers trying to deliver on President Barack Obama's signature issue.
Suddenly the Federal Reserve is everybody's punching bag.
Strip the Fed of its bank regulation powers, some in Congress are demanding. Get probing audits of its behind-the-scenes operations, others say.
The chairman of the Federal Reserve Board is always fair game for criticism and second-guessing, usually over interest rate actions. But this year the criticism is much broader as Congress responds to widespread public anger that the Fed bailed out Wall Street but not ordinary Americans, and with unemployment in double digits.
The Justice Department intends to drop manslaughter and weapons charges against one of the Blackwater Worldwide security guards involved in a deadly 2007 Baghdad shooting, prosecutors said in court documents Friday.
The shooting in busy Nisoor Square left 17 Iraqis dead and inflamed anti-American sentiment abroad. It touched off a string of investigations that ultimately led the State Department to cancel the company's lucrative contract to guard diplomats in Iraq.