NY Fed chief: Growth will pick up

The U.S. economy's sluggish growth so far this year will likely be temporary, New York's top banker said Friday.

William Dudley, president of the Federal Reserve Bank of New York, said the slow pace of hiring, high prices for gasoline and food and the March 11 Japan earthquake that have combined to dampened commerce will ease later this year. However, he said future growth would be fueled by overseas demand for U.S. goods and services, better financial conditions for big companies, less household debt and more hiring.

"Economic growth so far this year has been disappointing," Dudley told the Brooklyn Chamber of Commerce. But "this softness is related to factors that I expect will prove transitory."

He predicted that "economic growth will pick up enough in the second half of 2011 to sustain a moderate economic recovery" from the recession.

Still, Dudley acknowledged faster economic growth wasn't certain. He said a continuation of soaring gas prices and falling home values would reduce consumers' purchases of other goods, which would discourage businesses from hiring and investing in new equipment and factories.