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Fed Minutes Reflect Wariness About Recovery’s Strength

Wall Street Journal (05/17/12) Kristina Peterson; Jon Hilsenrath

According to minutes from the U.S. Federal Reserve’s April 24-25 meeting, which were released Wednesday, Fed officials were concerned about risks to the economic recovery in April when they decided to maintain their easy-money policies. Officials say there is a “sizable risk” that the federal government will sharply cut spending and increase taxes this year, which Fed Chairman Ben Bernanke calls a “fiscal cliff” that poses economic dangers. Still, the Fed predicts the economy will grow between 2.5% and 3% this year and unemployment will decline to under 8% by next year.