With mounting evidence that the economy is pulling decisively out of its recession. (Economy: How Supply Managers See High-Tech Business).(Shadow Open Market Committee proposes interest rate increase)(Brief Article)

Purchasing, May, 2002

* With mounting evidence that the economy is pulling decisively out of its recession, a growing group of economists is clamoring for an immediate interest-rate hike from the Fed. Latest pronouncement from the self-styled Shadow Open Market Committee: "Monetary policy is too accommodative and must be reversed.

The Fed must raise its federal funds target in order to drain the excess liquidity it provided last year." Reason: Current policy stance points toward inflation rates rising to 4%. "This is unacceptable," SOMC says.