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Wednesday, 23 October, 2002, 20:04 GMT 21:04 UK
US battles economic malaise
US economy graphic
The US is still battling against what the Federal Reserve has called a "sluggish" economy, following the latest survey of regional activity.

The Fed suggested that retail and manufacturing continued to struggle in a number of key areas in September and early October, while the job market remained stagnant.

The latest findings have prompted suggestions that the Fed will now cut interest rates again at its November meeting, in an effort to counter falling consumer confidence.

US interest rates have been at a 40-year low all this year, following the 11th cut last December.

Grey mood

The Fed's so-called 'Beige Book' survey, referring to the colour of its cover, collates findings from 12 regional banks.

So far this year, it has reported a mixed economy, with spurts of activity countered by slow growth elsewhere.

The latest survey for the last two months found that retail sales had slowed in some areas, while manufacturing continued to be "tough" and "stagnant".

The Fed described the job market at "lacklustre, with only a few reports of increased hiring".

Rate cut?

Some analysts have suggested that the ongoing weakness in the US economy, coupled with the threat of an attack on Iraq, could prompt a further cut in interest rates.

Fed policy-makers are due to meet on 6 November, and could use another rate cut to try and maintain consumer spending levels.

But other analysts say the US will maintain its 1.75% interest rates until the possible conflict with Iraq unfolds and the economy needs a renewed boost.


Economic indicators

Fears and hopes

US Fed decisons

IN DEPTH
See also:

03 Sep 02 | Business
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27 Jun 02 | Business
28 May 02 | Business
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