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Philly Fed chief projects "modest growth" in 2012

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Zack Seward
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WXXI
Philadelphia Fed President Charles Plosser speaking at the 33rd annual economic seminar in downtown Rochester.

The U.S. economy will grow by nearly three percent and the unemployment rate will dip to around eight percent by the end of 2012.

That's the prediction from Federal Reserve Bank of Philadelphia president Charles Plosser in a speech to more than 450 members of the Rochester business community Wednesday.

Plosser, a former dean of the University of Rochester's Simon Graduate School of Business, says he's "reasonably optimistic about the economy's future."

"I think the economy is looking up a little bit," Plosser told reporters after the annual speech, his 33rd.

"I'm a little more optimistic about 2012 than I was 2011. But it's going to be a long slow road back for the economy as a whole."

Plosser told luncheon attendees that the biggest risk to domestic growth in 2012 is the continuing sovereign debt crisis in Europe.

But, he added, "I, nor most forecasters, see much chance that the U.S. will slip back into recession in the coming year."

Plosser also made news in the financial press by suggesting that the Fed may raise interest rates before the middle of 2013.

WXXI/Finger Lakes reporter for the Innovation Trail.
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