Thursday, November 3, 2011

With few options, Fed turns to 'jawboning'

With little ammunition left in its armory, the Federal Reserve has entered the "jawboning" phase of its campaign to spur stronger economic growth.

Fed Chairman Ben Bernanke and his fellow policymakers emerged from a two-day meeting to declare they planned no major changes in their policy of using low interest rates to get the job and housing markets back on track. In a statement, the Fed pointed to a recent improvement in the outlook but warned that the recovery is still very fragile.

"Economic growth strengthened somewhat in the third quarter," the Fed said in its post-meeting statement. "There are significant downside risks to the economic outlook, including strains in global financial markets."

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