Research economist with Federal Reserve predicts international

Saturday, February 14, 2004

The international economy should rebound this year, led by an economic recovery in the United States, a research economist with the Federal Reserve Bank in St. Louis said Friday.

The economist, Dr. Patricia Pollard, said world trade has grown and countries are experiencing low inflation.

China continues to have a growing economy and is America's third largest source of imports, she told an audience of about 150 people, many of them students, at Southeast Missouri State University's sixth annual Economic Outlook Conference in Dempster Hall's Glenn Auditorium.

On the negative side, the U.S. dollar has declined in value by 28 percent against the world's major currencies since February 2002, Pollard said.

If the dollar continues to fall in value, it could slow international economic growth, she said. But overall, Pollard remains optimistic about the international economy.

Southeast Missouri State economist Dr. Bruce Domazlicky told the audience that the health of the nation's economy could play a role in who is elected president in November.

Lower unemployment would give a boost to President Bush's re-election effort, he said.

Despite the most recent recession, housing construction continues to grow, he said. "Sooner or later, it has to cool off."

Domazlicky, director of the Center for Economic and Business Research at Southeast, predicted the Federal Reserve won't make any major adjustments to interest rates this year.

"In an election year, the Federal Reserve is reluctant to make any real changes in policy," he said.

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