Greenspan Warns on Energy

A spike in oil prices above $60 per barrel along with other energy price rises posed another important economic risk.

“It is a shock. We do estimate a three-quarter-percentage point loss in real growth this year as a consequence of these prices,” he told lawmakers during the question-and-answer session that followed his prepared testimony.

A flattening in energy prices would be good for inflation, but Greenspan noted that financial futures markets see little chance of a decline in energy costs “for years to come.”

Reuters