Fed moves closer to more economic stimuli

3:18 AM, Jul 31, 2012   |    comments
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WASHINGTON (AP) - The Fed is inching, perhaps, toward another round of bond-buying, but the only question is when.

As the central bank begins a two-day meeting today in Washington, the U.S. economy is the chief concern. It grew at an annual rate of just 1.5 percent in the second quarter, even slower than in the first quarter.

Fed Chairman Ben Bernanke says the Fed is prepared to take action if unemployment stays high. But many economists believe the economy hasn't slowed enough to compel the Fed to announce further help right now.

Paul Edelstein, director of financial economics at IHS Global Economics, says the Fed could call for another round of quantitative easing, where the central bank sells short-term bonds and buys long-term paper to help stimulate economic activity, especially in the housing market.

(Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)

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