US Federal Reserve warns fresh economic stimulus may be required

13 October 2010

The American economy may soon be in need of an additional economic stimulus package, the Federal Reserve has warned.

In the latest meeting of the Federal Open Market Committee (FOMC), it was stated that such a measure could be required "before long", with one potential option being the purchase of extra government debt by the organization.

In September, 95,000 jobs were lost in the US, almost double the 54,000 that were shed during August, reports BBC News.

This increase has added to the pressure on the Federal Reserve to act.

"Many members considered the recent and anticipated progress toward meeting the committee's mandate of maximum employment and price stability to be unsatisfactory," said the minutes of the FOMC meeting.

Earlier this month, Goldman Sachs analyst Thomas Stopler predicted that the strength of the dollar will weaken if the Federal Reserve opts for a new round of quantitative easing in a bid to strengthen the economy, reported the Daily Telegraph.

By Gary Cooper

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