Brady Predicts Economy Headed for a 'Soft Landing'
The U.S. economy appears to be headed for a "soft landing" in which growth slows but does not pitch downward into a recession, Treasury Secretary Nicholas F. Brady said yesterday.</br></br>"I think that the statistics that we've seen come out in the last month, in recent weeks, indicate that . . . we are headed toward a soft landing, if that," Brady told reporters at the White House. "Some statistics indicate that things are slowing down some. Others don't indicate that."</br></br>Meanwhile, there were indications that Federal Reserve policy-makers may have decided at a two-day meeting that ended yesterday to seek lower short-term interest rates to keep growth from becoming too slow.</br></br>The central bank chose not to intervene yesterday in the government securities market, a move that left more cash in the nation's banking system than had been expected.</br></br>The Fed's decision not to "drain" the money away caused a key short-term rate, the federal funds rate, to drop by about one-eighth of a percentage point, to 9.375 percent. The federal funds rate is the interest rate charged by banks with excess reserves to banks needing overnight loans to meet reserve requirements.