Fed lowers US growth projections for 2014, 2015

WASHINGTON (AFP) - The Federal Reserve cut back its US economic growth forecasts for this year and next on Wednesday, but said the unemployment rate would fall faster than it forecast in December.

The Fed said the economy was expected to grow 2.8-3.0 per cent in 2014 and 3.0-3.2 per cent in 2015.

Those figures took 0.2 percentage points off the high end of the range for both years.

But the Fed also forecast that the unemployment rate would drop to 6.1-6.3 per cent this year - compared with the previous 6.3-6.6 per cent range estimate - and to 5.6-5.9 per cent in 2015.

In the update of its economic forecasts, the US central bank left its view of inflation largely unchanged, saying it could be as high as 1.6 per cent this year and 2.0 per cent next.