Furthermore, as of March there were still almost 3 million fewer jobs than at the end of 2007, and the ratio of employed Americans to the working age population was actually lower than it was at the end of the recession. Also, in an indication that employment is far from healthy, job finding rates have changed little since the recession. New York Fed staff research agrees with the broad consensus that cyclical factors are the major reason for the continued weakness in labor market conditions. In sum, these developments lead me to expect sluggish real GDP growth over the course of 2013 of about 2 to 2½ percent. As such, I anticipate that the unemployment rate will decline only modestly through the rest of the year. In the near term, there is considerable uncertainty about the outlook, particularly because the multiplier effects from fiscal drag and sequestration are still unclear. This uncertainty should gradually decline – for better or for worse – over the coming months, as the sequester’s impact takes hold and more economic data come in, giving us a clearer picture of the forward momentum of the economy. Inflation, as measured by the personal consumption expenditure deflator, is currently well below the Federal Reserve’s objective of 2 percent. There is substantial slack in the labor market and in the markets for goods and services, and underlying measures of inflation are subdued. Moreover, peoples’ expectations of inflation remain well anchored at levels consistent with our 2 percent longer-run objective.
William C Dudley: The outlook for the national and local economy Remarks by Mr William C Dudley, President and Chief Executive Officer of the Federal Reserve Bank of New York and Chairman of the Committee on the Global Financial System (CGFS), at the Staten Island Chamber of Commerce, Staten Island, New York, 16 April 2013. *  *  *  It is always a pleasure to speak with the business community given your important role in the community and in the region. I am particularly pleased to have the opportunity to speak to the Staten Island Chamber of Commerce and to be part of this distinguished panel. Thank you for inviting me today. As you know I have the honor of serving as the president and CEO of the New York Fed, one of the 12 Federal Reserve Banks that together with the Board of Governors in Washington make up the Federal Reserve System, our nation’s central bank. As head of the New York Fed I am vice-chairman of the Federal Open Market Committee (FOMC), the body that sets our nation’s monetary policy. The Fed was founded 100 years ago in 1913 to advance economic and financial stability. Over this century our nation’s economic output and standard of living has increased greatly, but the United States also faced many different challenges – ranging from the Great Depression of the 1930s to the Great Inflation of the 1970s and most recently the financial crisis.