News / USA

US Central Bank Mulls Action as Lawmakers Weigh In

TEXT SIZE - +

Investors are waiting to see what action, if any, the U.S. central bank might take to spark the country's struggling economy.

The U.S. Federal Reserve concludes a two-day meeting Wednesday, with many economists predicting the bank's policy board will move to further lower borrowing rates in an effort to spur growth.  But leading Republican lawmakers have taken the unusual step of writing a letter to the Fed, urging the central bank to do nothing.

The letter, signed by House Speaker John Boehner and Senate Minority Leader Mitch McConnell, warned the central bank to "resist further extraordinary intervention," saying such moves had yet to help boost the economy.  They also warned new action could do "further harm."

A leading Democratic senator, Charles Schumer, criticized the letter, accusing Republicans of meddling in the central bank's affairs.

Federal Reserve Chairman Ben Bernanke has repeatedly said the central bank still has ways to help spark economic growth.  But the Fed's board of governors has been divided over whether to make any moves.

The U.S. economic recovery has been uneven as many Americans struggle to find work.  The unemployment rate is at 9.1 and has hovered above 9 percent for months.

Other key sectors of the economy, like the housing market, are also facing difficulties.

A report released Wednesday by the National Association of Realtors said sales of previously owned homes rose 7.7 percent in August, from the previous month.  But the trade group's report also said sales were driven by investors buying foreclosed homes.

The Fed has tried to spark the economy, and home sales, by lowering its benchmark lending rate to an all-time low of zero to one-quarter of a percent.

Many economists believe the Fed is considering a policy known as "Operation Twist."   The policy calls for selling short-term securities in its $1.7 trillion portfolio to buy longer-term holdings.  The goal of such a move would be to lower yields on U.S. Treasury bonds in the hopes of driving down consumer borrowing rates.

The U.S. Federal Reserve is set up as an independent decision-making entity.  Fed Chairman Ben Bernanke is a Republican and was first appointed by Republican President George W. Bush.  He was then renominated by Democratic President Barack Obama.

Some information for this report was provided by AP, AFP and Reuters.

You May Like

Multimedia Relatives of South Korean Ferry Victims Fire at Authorities

46 people are confirmed dead, but some 250 remain trapped inside sunken ferry More

War Legacy Haunts Vietnam, US Relations

$84 million project aims to clean up soil contaminated by Agent Orange More

Wikipedia Proves Useful for Tracking Flu

Technique gave better results than Center for Disease Control (CDC) and Google’s Flu Trends More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Ukraine, Russia, United in Faith, Divided in Politicsi
X
Michael Eckels
April 19, 2014
There is a strong historical religious connection between Russia and Ukraine. But what role is religion playing in the current conflict? In the run-up to Easter, Michael Eckels in Moscow reports for VOA.
Video

Video Ukraine, Russia, United in Faith, Divided in Politics

There is a strong historical religious connection between Russia and Ukraine. But what role is religion playing in the current conflict? In the run-up to Easter, Michael Eckels in Moscow reports for VOA.
Video

Video Face of American Farmer is Changing

The average American farmer is now 58 years old, and farmers 65 and older are the fastest growing segment of the population. It’s a troubling trend signaling big changes ahead for American agriculture as aging farmers retire. Reporter Mike Osborne says a new report from the U.S. Census Bureau is suggesting what some of those changes might look like... and why they might not be so troubling.
Video

Video Donetsk Governor: Ukraine Military Assault 'Delicate But Necessary'

Around a dozen state buildings in eastern Ukraine remain in the hands of pro-Russian protesters who are demanding a referendum on self-rule. The governor of the whole Donetsk region is among those forced out by the protesters. He spoke to VOA's Henry Ridgwell from his temporary new office in Donetsk city.
Video

Video Drones May Soon Send Data From High Seas

Drones are usually associated with unmanned flying vehicles, but autonomous watercraft are also becoming useful tools for jobs ranging from scientific exploration to law enforcement to searching for a missing airliner in the Indian Ocean. VOA’s George Putic reports on sea-faring drones.
Video

Video New Earth-Size Planet Found

Not too big, not too small. Not too hot, not too cold. A newly discovered planet looks just right for life as we know it, according to an international group of astronomers. VOA’s Steve Baragona has more.
Video

Video Copts in Diaspora Worry About Future in Egypt

Around 10 percent of Egypt’s population belong to the Coptic faith, making them the largest Christian minority in the Middle East. But they have become targets of violence since the revolution three years ago. With elections scheduled for May and the struggle between the Egyptian military and Islamists continuing, many Copts abroad are deeply worried about the future of their ancient church. VOA religion correspondent Jerome Socolovsky visited a Coptic church outside Washington DC.
Video

Video Critics Say Venezuelan Protests Test Limits of Military's Support

During the two months of deadly anti-government protests that have rocked the oil-rich nation of Venezuela, President Nicolas Maduro has accused the opposition of trying to initiate a coup. Though a small number of military officers have been arrested for allegedly plotting against the government, VOA’s Brian Padden reports the leadership of the armed forces continues to support the president, at least for now.
Video

Video More Millenials Unplug to Embrace Board Games

A big new trend in the U.S. toy industry has more consumers switching off their high-tech gadgets to play with classic toys, like board games. This is especially true among the so-called millenial generation - those born in the 1980's and 90's. Elizabeth Lee has more from an unusual café in Los Angeles, where the new trend is popular and business is booming.
Video

Video Google Buys Drone Company

In its latest purchase of high-tech companies, Google has acquired a manufacturer of solar-powered drones that can stay in the air almost indefinitely, relaying broadband Internet connection to remote areas. It is seen as yet another step in the U.S. based Web giant’s bid to bring Internet to the whole world. VOA’s George Putic reports.
AppleAndroid