WASHINGTON -- U.S. economic growth is picking up after hitting a "soft patch" earlier this year and oil prices are so far not pushing inflation higher, Federal Reserve Chairman Alan Greenspan said today.
"The most recent data suggest that on the whole, the expansion has regained some traction," Greenspan said in prepared testimony to the House Budget Committee.
Crude prices have fallen over the past two weeks. It traded at $43.31 a barrel this morning. Still, oil prices, which hit a dollar record $49.40 a barrel on Aug. 20, may rise again, he said.
"The growing concerns about long-term supply, along with large prospective increases in demand from the rapidly growing economies of China and India, both of which are expanding in ways that are relatively energy-intensive, have propelled prices of distant futures to levels well above their ranges of recent years," Greenspan said.
His remarks suggest the Fed's policy making Open Market Committee is likely to stick to its plan for raising interest rates at what it calls a "measured pace."
archive