There is likely to be a lot of talk about economic policy this week, as President Obama delivers his State of the Union address and the Federal Reserve meets.


Pundits expect Obama to use his State of the Union address to once again push for policies to strengthen the middle class.

Obama is likely to carry his middle class theme into the 2012 presidential campaign, calling on Congress to pass measures to invest in roads and transportation, education and other measures that will strengthen the economy, while asking wealthier Americans to pay more of the cost of these investments.


The Federal Reserve concludes a two-day meeting, its first policymaking meeting of the year. The Fed, according to analysts, is not expected to take new action to stimulate the economy. Many analysts, however, expect that the Fed will take steps later in the year, perhaps by buying mortgage-backed securities in an effort to further drive down interest rates on home loans.

The Fed also for the first time is slated to publish interest-rate projections. The central bank could disclose when officials first expect to hike the Federal Funds rate, which is the benchmark rate for lending in the United States and now hovers just above zero. Fed officials also could chart what they expect the Fed funds rate to be at the end of this year and the next two years, as well as in the long-term.


The federal government reports on how fast the economy grew in the final three months of 2011. Many analysts expect relatively robust growth of roughly 3 percent, a pick up of sorts after a sluggish first nine months. An increase in consumer spending during the holiday season, among other factors, was likely a driving force in the rise in the gross domestic product during the quarter.

But the economy is projected to slow again this quarter.