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Forecasts mixed on Fed’s moves

WASHINGTON — Business economists are divided over whether the Federal Reserve will pare its bond purchases at the current pace through year’s end or pause to let the economy recover further.

The views were unveiled Monday by the National Association for Business Economics, which conducted its twice-a-year survey of 230 members Jan. 30 to Feb. 6, before Janet Yellen’s first appearance before Congress as Fed chair.

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About 43 percent of NABE members said the Fed would complete its pullback in bond purchases in the fourth quarter. About 42 percent predicted the Fed would finish in 2015 or later.

At each of its last two meetings, the Fed cut bond purchases by $10 billion to the current $65 billion a month. There are seven meetings left in 2014. The purchases are intended to drive down loan rates to stimulate growth.

A majority of those surveyed agreed with the Fed’s gradual end to its program, with 57 percent saying monetary policy is ‘‘about right.’’ About 37 percent thought it was ‘‘too stimulative.’’

Most respondents thought the Fed would wait until 2015 to start raising its key short-term interest rate above the current level near zero. Yellen told Congress earlier this month that the Fed would keep the rate near zero ‘‘well past’’ the time the unemployment rate falls below 6.5 percent, as long as inflation remains low. The unemployment rate was 6.6 percent in January, a five-year low.

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