The Macroeconomic Situation in the USA

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Micro-Economic Situation in the USA United States economy was faced with grim economic prospects that nearly plunged the economy into recession. The measures that were put in place by the Congress and the Federal Reserve Bank did make the US economy survive the recession scare that was realized in August 2011. This recession scare was occasioned by the figures generated from the July 29th GDP report (Bullard, 2011). The Federal Open Market Committee (FOMC) has however remained on the outlook and has warned the players in the financial markets of a possible downside risk originating from Europe. The basis of FOMC assertion was premised on European sovereign debt crisis that eroded the confidence households and businesses had in certain financial institutions. However, the drops in confidence have not impacted growth because large businesses have focused their growth strategies to Asia as opposed to Europe. Besides, households are less bothered by events unfolding in Europe which they consider too distant to make them change their behavior (Bullard, 2011). As at January 2013, civilian unemployment rate stood at 7.9%. This was coupled with a four week moving average of 350,500 initial jobless claims (Federal Reserve Bank of St. Louis, 2013). This means there was a 0.1 percentage increase in civilian unemployment rates considering that the civilian unemployment rate was 7.8% as at December 2012. There was also a +157 change in payroll employment as at January 2013. For
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