U.S. Official Says fed Curbs May Slow Growth in 1982: Fed Policy Seen Curbing 1982 Growth
A Reagan administration economist said yesterday ÛÏit is hard to believe that we can have rapid growth next yearÛ under the Federal ReserveÛªs current monetary policy.</br></br>Robert Dederick, assistant secretary of Commerce for economic affairs, made his prediction at a news conference as Fed Chairman Paul Volcker was reaffirming before the Senate Banking Committee the need to continue the tight money policy backed by the president.</br></br>Statements from the two men came as the government released more evidence that the nation is heading deeper into recession.</br></br>The nationÛªs index of leading indicators dropped by 2.7 percent in September, the sixth monthly fall this year and the largest drop since a 4 percent decline in the midst of the 1980 recession.</br></br>Although the drop may have been somewhat exaggerated by technical factors, few analysts doubt that the econopiy is now contracting. Other figures released yesterday showed that business productivity fell by 2.2 percent in the third quarter, measured at a seasonally adjusted annual rate.