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Jul 14, 2010 8:52 PM by Chris Welty

Weaker Fed Forecast Sends Interest Rates Lower

NEW YORK (AP) - Interest rates are falling in the Treasury
market as a weaker economic forecast from the Federal Reserve
boosts buying of safe-haven assets.
The Fed says it expects the economy to grow between 3 and 3.5
percent this year. That's down from the 3.2 percent to 3.7 percent
forecast in April.
The central bank is also offering a less upbeat employment
forecast. The Fed says it expects the unemployment rate, now at 9.5
percent, to bottom out at 9.2 percent this year. In April, it
predicted unemployment would fall to 9.1 percent.
Investors are reacting by shifting money into safer assets like
Treasurys, driving interest rates lower. The yield on the benchmark
10-year Treasury note is down to 3.05 percent from 3.13 percent.

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