USA Today
WASHINGTON — Federal Reserve officials continued to talk up the economy yesterday, as Fed Chairman Alan Greenspan warned bankers not to withhold loans from healthy borrowers and a Fed survey painted a picture of a weak but continuing expansion.
In a report that appeared to take some of the urgency out of the Fed’s campaign to cut interest rates, the latest "beige book" survey of nationwide economic conditions reported "sluggish to moderate" growth. Consumer spending rose slightly, labor markets eased, and price increases outside energy remained tame.
"It’s a more positive beige book than the last one," says Dallas Fed Bank president Robert McTeer. "This is more mixed.·"
After the economy seemed to hit a wall in December, the Fed twice cut rates sharply in January Economists had speculated the Fed might make another such emergency rate cut if conditions worsened or stayed the same. But since then, the economy seems to have rebounded slightly.
Yesterday’s beige book — a regular Fed survey known for the color of its cover — echoes recent comments by Greenspan, whose sober but nonpanicky view of the economy in congressional testimony last month convinced analysts that the Fed wouldn’t cut rates before its next meeting March 20.
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