By Michael Flaherty and Howard Schneider WASHINGTON (Reuters) – The Federal Reserve on Wednesday said the U.S. economy was expanding “at a solid pace” with strong job gains in a signal that the central bank remains on track with its plans to raise interest rates this year. The Fed repeated it would be “patient” in deciding when to raise benchmark borrowing costs from zero, though it also acknowledged a decline in certain inflation measures. After a two-day meeting of the Federal Open Market Committee, policymakers struck an upbeat tone on the U.S. economy's prospects and held to their view that energy-led weakness in inflation would dissipate. “The committee, in fact, was downright bullish on current economic conditions and the outlook,” said Paul Edelstein, director of financial economics at IHS Global Insight.
By Robin Emmott BRUSSELS (Reuters) – The guessing game over U.S. interest rates is likely to intensify this week after new Fed Chair Janet Yellen raised the prospect of a hike early next year, while Russia's annexation of Crimea will keep investors focused on its next move. In a week heavy with diplomacy – U.S. President Barack Obama will meet Chinese counterpart Xi Jinping on Monday in The Hague – markets will seek clarity from the U.S. Federal Reserve on its monetary policy and from Russia over its intentions in Ukraine.
By Wayne Cole SYDNEY (Reuters) – Asian shares spent much of Friday in a state of suspended animation as tension mounted ahead of jobs data that could make or break the case for an imminent scaling back in U.S. stimulus. Government borrowing costs from Japan to Australia hit fresh highs on trepidation the Federal Reserve could start tapering its $85 billion of monthly debt purchases at its policy meeting on December 17 and 18.
By Lucia Mutikani WASHINGTON (Reuters) – A gauge of U.S. consumer spending rose in September as Americans likely snapped up Apple's new iPhone and bought leisure goods, but falling sales of automobiles pointed to sluggish economic growth during the third quarter. Other data on Tuesday showed lackluster demand was keeping inflation muted, with wholesale prices unexpectedly falling last month. That should provide the Federal Reserve with ammunition to maintain monthly bond purchases for a while as it tries to nurse the economy back to health. …