"While growth in 2013 has been disappointing, I believe a good case can be made that the pace of growth will pick up some in 2014 and then somewhat more in 2015"
- William C. Dudley, Federal Reserve Bank of New York President
Some analysts believe a 16-day long government shutdown, political disputes and a set of budget cuts known as sequester, have weighed on the world's largest economy, and cut off substantial part of GDP this year. Nevertheless, a welcoming sign occurred this week as one the most dovish bankers, William Dudley pointed out he is getting more hopeful on prospects for the beleaguered economic amelioration.
The President of the New York Fed, who is known as one the main supporters in favour of easy-money policies, expected a pickup in hiring last month and stronger-than-expected GDP data in the third quarter, while he predicts acceleration in growth next year and especially in 2015. However, despite improved outlook he stressed out the monetary policy to remain very accommodative for a considerable period of time, taking into account very weak inflationary pressure and still high unemployment.
Though this is just an opinion of one of FOMC members, it suggests the whole Fed is getting closer to reducing the pace of its $85 billion in monthly bond purchases, increasing the possibility of bold statements this week, or during December's meeting.
© Dukascopy Bank SA