Wall Street Journal (04/22/14) Jon Hilsenrath
U.S. Federal Reserve officials are on track to reduce their monthly bond buying to $45 billion at their policy meeting next week and stick with a communications approach that leaves investors guessing about when the central bank will start raising short-term interest rates. “While monetary-policy discussions naturally begin with a baseline outlook, the path of the economy is uncertain, and effective policy must respond to significant unexpected twists and turns the economy may take,” Fed chairman Janet Yellen said in a speech at the Economic Club of New York.
Slow productivity growth is contributing to the uncertainty. U.S. output-per-hour worked rose just 0.5% last year and seems to have grown slowly in the first quarter of this year.