Transcripts of the monetary policymaking body of the Federal Reserve from 2002–2008.

If the full trajectory going through the rest of this year that is in the Greenbook takes place, then the United States is going to take the world back just a bit, and it will bring Canada with it probably. At least that is what our forecast says will happen. We see China stepping harder on the mechanisms that it uses to try to slow its economy. In some sense, I would say that the Greenbook picture we’re painting is that global capacity utilization is perhaps at a peak right about now and that we anticipate the slowing in the United States and the efforts in China certainly to outweigh the continued strength, say, in Europe or Japan, which is probably going to happen. Still in all, that may be the mean of our forecast, but there’s a distribution around that, and it’s certainly possible that there are upside risks as well as downside risks in those capacity pressures.

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