Federal Reserve cuts for US economic growth

The Federal Reserve has cut its forecast for economic growth in 2012 from 2.9% to 2.4%, BBC reported. It has also predicted a central unemployment rate of up to 8.2%, having forecast up to 8% on 25 April. The central bank also extended its programme of swapping short-term bonds for long-term ones, known as Operation Twist, until the end of the year. The idea of the programme is to cut the long-term cost of borrowing for businesses and households. The programme is worth $267bn (£170bn). In a news conference, Federal Reserve chairman Ben Bernanke said unemployment was still too high and was going down too slowly. "We are prepared to take further steps if necessary to promote sustainable growth and recovery in the labour market," he said. The rise in the central prediction of the unemployment rate came after the jobless rate rose from 8.1% to 8.2% in April. The Federal Reserve Monetary Policy Committee's decision on Operation Twist was not unanimous, with one of the 12 members voting against it.