FACTBOX-Fed staff forecasts from FOMC minutes

May 20 (Reuters) - The following are the Federal Reserve's
staff forecasts as contained in the minutes of Federal Open
Market Committee meetings:

APRIL 28-29 FOMC: Minutes released on May 20, 2009:

"Staff Economic Outlook

In the forecast for the meeting, which was prepared prior
to the release of the advance estimates of the first-quarter
national income and product accounts, the staff revised up its
outlook for economic activity in response to recent favorable
financial developments as well as better-than-expected readings
on final sales. Consumer purchases appeared to have stabilized
after falling in the second half of 2008, and the steep decline
in the housing sector seemed to be abating. However, the
contraction in the labor market persisted into March,
industrial production again fell rapidly, and the broad-based
decline in equipment and software investment continued.
Conditions in financial markets improved more than had been
expected: Private borrowing rates moved lower, stock prices
rose substantially, and some measures of financial stress
eased. The staff's projections for economic activity in the
second half of 2009 and in 2010 were revised up, with real GDP
expected to edge higher in the second half and then increase
moderately next year. The key factors expected to drive the
acceleration in activity were the boost to spending from fiscal
stimulus, the bottoming out of the housing market, a turn in
the inventory cycle from liquidation to modest accumulation,
and ongoing gradual recovery of financial markets. The staff
again expected that the unemployment rate would rise through
the beginning of 2010 before edging down over the rest of that
year. The staff forecast for overall and core personal
consumption expenditures (PCE) inflation over the next two
years was revised up slightly. The staff raised its near-term
estimate of core PCE inflation because recent data on core and
overall PCE price inflation came in a bit higher than
anticipated. Beyond the near term, however, the staff
anticipated that the low level of resource utilization and a
gradual decline in inflation expectations would lead to a
deceleration in core PCE prices. Looking out to 2011, the staff
anticipated that financial markets and institutions would
continue to recuperate, monetary policy would remain
stimulative, fiscal stimulus would be fading, and inflation
expectations would be relatively well anchored. Under such
conditions, the staff projected that real GDP would expand at a
rate well above that of its potential, that the unemployment
rate would decline significantly, and that overall and core PCE
inflation would stay in a low range."

MARCH 17-18 FOMC: Minutes released on April 8, 2009:

"In the forecast prepared for the meeting, the staff
re-vised down its outlook for economic activity. The
de-terioration in labor market conditions was rapid in re-cent
months, with steep job losses across nearly all sec-tors.
Industrial production continued to contract ra-pidly as firms
responded to the falloff in demand and the buildup of some
inventory overhangs. The incom-ing data on business spending
suggested that business investment in equipment and structures
continued to decline. Single-family housing starts had fallen
to a post-World War II low in January, and demand for new homes
remained weak. Both exports and imports retreated significantly
in the fourth quarter of last year and appeared headed for
comparable declines this quarter. Consumer outlays showed some
signs of sta-bilizing at a low level, with real outlays for
goods out-side of motor vehicles recording gains in January and
February. Financial conditions overall were even less
supportive of economic activity, with broad equity in-dexes
down significantly amid continued concerns about the health of
the financial sector, the dollar stronger, and long-term
interest rates higher. The staff's projections for real GDP in
the second half of 2009 and in 2010 were revised down, with
real GDP expected to flatten out gradually over the second half
of this year and then to expand slowly next year as the
stresses in financial markets ease, the effects of fiscal
stimulus take hold, inventory adjustments are worked through,
and the correction in housing activity comes to an end. The
weaker trajectory of real output re-sulted in the projected
path of the unemployment rate rising more steeply into early
next year before flattening out at a high level over the rest
of the year. The staff forecast for overall and core personal
consumption expenditures (PCE) inflation over the next two
years was revised down slightly. Both core and overall PCE
price inflation were expected to be damped by low rates of
resource utilization, falling import prices, and easing cost
pressures as a result of the sharp net de-clines in oil and
other raw materials prices since last summer."

JAN 27-28 FOMC: Minutes released on Feb. 18, 2009:

"In the forecast prepared for the meeting, the staff
revised down its outlook for economic activity in the first
half of 2009, as the implications of weaker-than-anticipated
economic data releases more than offset an upward revision to
the staff's assumption of the amount of forthcoming fiscal
stimulus. Conditions in the labor market deteriorated sharply
over the intermeeting period. Industrial production declined
steeply, and household and business spending fell more than
anticipated. Sales and starts of new homes remained on a steep
downtrend. Foreign demand also was weaker than expected.
Financial markets continued to be strained overall, credit
remained unusually tight for both households and businesses,
and equity prices had fallen further. The staff's projections
of real GDP growth in the second half of 2009 and in 2010 were
revised upward slightly, reflecting greater monetary and fiscal
stimulus as well as the effects of more moderate oil prices and
long-term interest rates, but they continued to show no more
than a gradual economic recovery. The staff again expected that
unemployment would rise substantially through the beginning of
2010 before edging down over the remainder of that year.
Forecasts for core and overall PCE inflation in 2009 and 2010
were little changed, with growth in both core and overall PCE
prices expected to be unusually low over the next few years in
response to slack in resource utilization and relatively flat
prices anticipated for many commodities and for imports."

DEC. 15-16 FOMC: Minutes released on Jan. 6, 2009:

"In the forecast prepared for the meeting, the staff
revised down sharply its outlook for economic activity in 2009
but continued to project a moderate recovery in 2010. Real GDP
appeared likely to decline substantially in the fourth quarter
of 2008 as conditions in the labor market deteriorated more
steeply than previously anticipated; the decline in industrial
production intensified; consumer and business spending appeared
to weaken; and financial conditions, on balance, continued to
tighten. Rising unemployment, the declines in stock market
wealth, low levels of consumer sentiment, weakened household
balance sheets, and restrictive credit conditions were likely
to continue to hinder household spending over the near term.
Homebuilding was expected to contract further. Business
expenditures were also likely to be held back by a weaker sales
outlook and tighter credit conditions. Oil prices, which
dropped significantly during the intermeeting period, were
assumed to rise over the next two years in line with the path
indicated by futures market prices, but to remain below the
levels of October 2008. All told, real GDP was expected to fall
much more sharply in the first half of 2009 than previously
anticipated, before slowly recovering over the remainder of the
year as the stimulus from monetary and assumed fiscal policy
actions gained traction and the turmoil in the financial system
began to recede. Real GDP was projected to decline for 2009 as
a whole and to rise at a pace slightly above the rate of
potential growth in 2010. Amid the weaker outlook for economic
activity over the next year, the unemployment rate was likely
to rise significantly into 2010, to a level higher than
projected at the time of the October 28-29 FOMC meeting. The
disinflationary effects of increased slack in resource
utilization, diminished pressures from energy and materials
prices, declines in import prices, and further moderate
reductions in inflation expectations caused the staff to reduce
its forecast for both core and overall PCE inflation. Core
inflation was projected to slow considerably in 2009 and then
to edge down further in 2010."