AFTER A SOFT FOURTH QUARTER, THE NEW YEAR SHOULD RE HAPPIER

摘要

The Federal Reserve is fed up with the toll that uncertainty is taking on the economy. That much was clear from the Fed's surprisingly aggressive half-point cut in interest rates on Nov. 6. While the move will do little to aid what promises to be a weak fourth quarter, it helps to lay the groundwork for stronger growth in 2003. In a unanimous vote, the Fed reduced its overnight federal funds rate to 1.25% and said pointedly that "greater uncertainty, in part attributable to heightened geopolitical risks, is currently inhibiting spending, production, and employment." The action appeared to be aimed directly at shoring up business' confidence in the future. But it may be a one-shot move, since the Fed also said the balance of risks in the outlook were no longer skewed toward economic weakness.