WASHINGTON (June 20, 2013) — The U.S. unemployment rate will fall to between 6.5 and 6.8 percent in 2014, and to between 5.8 and 6.2 percent in 2015, according to the latest economic projections by Federal Reserve board members and bank presidents.
The Federal Reserve released its latest projections June 19, the same day the Fed's Federal Open Market Committee (FOMC) predicted a continued moderate pace of economic growth.
"The committee sees the downside risks for the economy and the labor market as having diminished since the fall," the FOMC said in its statement.
The change in real GDP, according to the Fed board and bank presidents, will grow from 2.3-2.6 percent this year to 3.0-3.5 percent in 2014 and 2.9-3.6 percent in 2015.
For the time being, the Fed intends to continue its monthly purchases of $40 billion worth of mortgage-backed securities and $45 billion worth of longer-term Treasury securities to support the economic recovery, the FOMC said. However, it will closely monitor economic and labor data, and reduce or end its purchases of securities when the labor market shows sufficient improvement, it said.
The Fed's intimation that it would soon stop buying securities caused stocks to fall around the world. At 12:42 p.m. on June 20, the Dow Jones Industrial Average had dropped more than 200 points and stood at 14,908.