The Federal Reserve has revealed that it is looking at new measures to keep the faltering US economic recovery on track. It has warned that jobs and growth will be tougher to regain than expected.
The Fed lowered its US growth forecast for this year to a range of 3% to 3.5%, slightly down from the 3.2% to 3.7% it expected a few months ago.
The warnings - in the minutes of the Fed's June meeting - fuelled concerns that the US faces tough times for years to come.
Noting that the recovery continued at a 'moderate pace', members of the rate-setting Federal Open Market Committee said a worsening outlook should prompt debate over more government measures to boost the economy.
'The committee would need to consider whether further policy stimulus might become appropriate if the outlook were to worsen appreciably,' the minutes said. But with interest rates at all-time lows, experts say the Fed has few tools at its disposal.
During the height of the crisis, the Fed and the US Treasury ploughed trillions of dollars into the economy by buying up 'toxic' assets and government debt.
Analysts said the Fed's language did not necessarily spell a repetition of that policy, but was a clear message that reversing crisis-era policies will come later rather than sooner.
The Federal Open Market Committee's meeting took place on June 22-23, amid fears about the impact of a European debt crisis that rattled global financial markets.
Against this bleak backdrop, the Fed also raised its end-of-year unemployment forecast to a range of 9.2% to 9.5%, predicting the troubled labour market would recover more slowly than expected.
Fed members expected the pace of the economic recovery to be held back by uncertainty among households and businesses, persistent weakness in property markets, only gradual improvement in labour market conditions and the slow easing of credit conditions in the banking sector.
