Bet You A Nickel There's A Rate Cut

Despite healthier data, enough threats to growth remain

Which way is the wind blowing at the Federal Reserve? The stormy economic forecast that prompted back-to-back cuts in September and October seems to have brightened. Third-quarter gross domestic product, expected to grow only slowly, surged by 3.3%. Consumer spending grew at a solid 3.9% rate. Productivity was up 2.3%. Even Federal Reserve Chairman Alan Greenspan seemed to lighten up--noting on Nov. 5 that he saw "significant signs" that some abnormally large spreads in bond and debt rates were narrowing.

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