New Federal Reserve chief Bill Gross made a surprising announcement recently, declaring that, for the first time in two years, the Fed would not be raising interest rates. Additionally, depending on the severity of the decline of the housing market, the Fed may begin cutting interest rates as early as mid 2007. He reassured concerned parties that the Fed’s firm stance on inflation would continue Gross estimates that Fed fund rates will be between 4 and 4.5 percent, as the bonds market has taken a downturn.
It is expected that the policy-setting panel meeting will also address the high unemployment rate and overall lack of new jobs in recent months. ■
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