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5 Numbers Bernanke Will Be Watching

These figures will dictate how soon the Fed stops QE

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Real America IndexBernanke said that subsequent data have to remain broadly aligned with the Fed’s current expectations for the economy in order to reduce the pace of long-term debt purchases, and there’s no more important broad measure of the economy than gross domestic product.

The Fed forecasts GDP to expand between 2.3% and 2.6% this year. But on Wednesday we learned that first-quarter growth was much weaker than initially thought. The Commerce Department said GDP grew just 1.8% in the January-to-March period, well below the prior estimate of 2.4%.

A second-half acceleration in GDP will be critical to the Fed’s plans. After the lousy first-quarter showing, the economy has a lot of catching up to do in the remaining three quarters of the year.

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