U.S. Treasury Secretary Jacob J. Lew is trying to persuade Congress to raise the $16.7 trillion debt ceiling without the drama that contributed to a stock market rout in 2011. A stronger economy this time around may help keep investors calm.
Unemployment will fall to about 7 percent in the fourth quarter, according to economists at five of the world’s largest banks, creating more confusion among investors about the Federal Reserve’s bond-buying plans.
Federal Reserve Chairman Ben S. Bernanke opened the door to a delay in reducing the central bank’s bond buying program, saying it will depend on data that economists say are falling short of the Fed’s own forecasts.
The Federal Reserve will probably trim its monthly asset purchases by almost a third in September if the labor market continues to strengthen, according to Joseph LaVorgna, Deutsche Bank AG’s chief U.S. economist.
Chairman Ben S. Bernanke will probably reduce the Federal Reserve’s monthly bond buying in the fourth quarter to $50 billion from $85 billion as he begins to unwind record stimulus, economists said in a Bloomberg survey.
Federal Reserve Chairman Ben S. Bernanke prepared to deliver a speech on the outlook for the U.S. economy as some of the most optimistic forecasters scaled back their projections for growth in the second half.