By Chris Isidore,CNNMoney.com
Brother can you spare a dime?
The Federal Reserve’s latest forecasts for the U.S. economy are gloomier than the ones released three months earlier,with an expectation for higher unemployment and a steeper drop in economic activity.
The Fed’s forecasts,released as part of the minutes from its April meeting,show that its staff now expects the unemployment rate to rise to between 9.2% and 9.6% this year. The central bank had forecast in January that the jobless rate would be in a range of 8.5% to 8.8%,but the unemployment rate topped that in April,hitting 8.9%.
The Fed also now expects the gross domestic product,the broadest measure of the nation’s economic activity,to post a drop of between 1.3% and 2% this year. It had previously expected only a 0.5% to 1.3% decline.