Fed slashes growth, employment projections

This should come as absolutely no surprise to anyone who's been paying attention.

In an announcement that is likely to deepen concerns over the U.S. economic woes the Federal Reserve has slashed growth and employment projections for 2011 and 2012.

Data projections released by the Fed suggested that it had revised a measure of the average, or “central tendency,” for the U.S. economy's 2011 gross domestic product growth rate from the 2.7-2.9 per cent range to the 1.6-1.7 per cent range. Similarly, the central bank cut its 2012 projection for growth from the 3.3-3.7 per cent range to the 2.5-2.9 per cent range.

Unemployment which in June the Fed projected would hover between 8.6 per cent and 8.9per cent during 2011 was revised and projected to remain between 9 per cent and 9.1 per cent for the rest of the calendar year.

For 2012, the average unemployment rate was similarly revised upward from the 7.8-8.2per cent range to the 8.5-8.7 per cent range.