September 26, 20073:36 PM EDTUpdated 17 years ago
WASHINGTON, Sept 26 (Reuters) – U.S. inflation pressures are easing and the economy should manage a soft landing, the Federal Reserve Bank of Dallas said on Wednesday.
“The latest data reinforce the impression of an economy in which growth remains moderate and inflationary pressures are likely to continue to subside,” it said in a national economic review written by senior Dallas Fed staff economist Tao Wu.
“A soft landing with a slow convergence to trend growth is probable, unless uncertainties among households and investors suddenly trigger a sharp consumption slowdown or the credit crunch spreads beyond housing the sector,” he said.
The U.S. central bank slashed interest rates by an unexpectedly bold half percentage point last week to 4.75 percent to shield the economy from the slumping housing market, which has triggered a global credit crunch.
h/t sailormooooooooon