Fed Chief Sees More Traction in Expansion
By EDMUND L. ANDREWS
Published: September 9, 2004
WASHINGTON, Sept. 8 - Alan Greenspan, chairman of the Federal Reserve Board, said on Wednesday that the economic expansion had "regained some traction" after the slowdown this summer and suggested that the central bank could be expected to keep raising interest rates, including at its next meeting later this month.
"The most recent data suggest that, on the whole, the expansion has regained some traction," Mr. Greenspan told the House Budget Committee.
"Consumer spending and housing starts bounced back in July after weak performances in June," he said, while consumer prices are climbing more slowly than they did last spring.
The Fed chairman again described the recent slowdown as a "soft patch" that stemmed largely from a surge in oil prices. Though he expressed concern that oil prices could remain high for some time, he was cautiously optimistic that higher prices would drive down demand and encourage oil producers to expand capacity....
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Meanwhile, Mr. Greenspan distanced himself a bit more from the Bush administration and Congressional Republicans on the issue of reducing the federal deficit. As he has before, the Federal Reserve chairman urged lawmakers to reinstate rules that expired in 2002 that required Congress to pay for both tax cuts and new spending programs by either spending cuts or tax increases in other areas....
http://www.nytimes.com/2004/09/09/business/09fed.html
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