TOPICS > Economy

News Wrap: Federal Reserve Downgrades U.S. Economic Growth to ‘Modest’

July 31, 2013 at 12:00 AM EDT

KWAME HOLMAN: The Federal Reserve downgraded its assessment of the economy today. The Central Bank reported only modest growth, slightly worse than the moderate reading it gave in June. That suggested there’s no early end in sight to the Fed’s economic stimulus efforts.

The reaction on Wall Street was mixed. The Dow Jones industrial average lost 21 points to close at 15,499. The NASDAQ rose nearly 10 points to close at 3,626.

The U.S. House has given final approval to a student loan deal, just in time for the fall semester. The bipartisan agreement already passed the Senate. It will tie interest rates to the performance of the financial markets. That means undergraduates who take out their own loans will pay 3.9 percent this fall. The interest rates would rise over time as the economy improves.

President Obama paid a rare call on Congress today. He talked up his economic ideas to fellow Democrats and tried to calm concerns about his health care law.

KWAME HOLMAN: The president arrived first on the House side of the Capitol, and later, after a closed-door session that lasted nearly an hour, he said his message was simple.

PRESIDENT BARACK OBAMA: Jobs, middle class, growth.

KWAME HOLMAN: House Minority leader Nancy Pelosi said her members were enthusiastic.

REP. NANCY PELOSI, D-Calif.: It was a really masterful presentation that he made on the subject of jobs and the future. And, today, we had the chance to go back and forth on some of the issues that — so he could hear some of our priorities, and we his.

KWAME HOLMAN: Other Democrats said those issues included the public’s confusion over the new health care law and fears the prospects for immigration reform legislation may be dimming.

Later, Mr. Obama crossed the Capitol for a similar meeting with Senate Democrats. Maine independent Angus King, who caucuses with the Democrats, said, on health care, the president urged them to remind people that a lot of good things are happening.

Congress also faces a September 30 deadline to approve new spending bills or risk a government shutdown. Washington State’s Patty Murray said the president also warned Republicans must keep budget issues separate from the looming debt limit legislation.

SEN. PATTY MURRAY, D-Wash.: He made it very clear that he wasn’t going to negotiate over the debt ceiling. We have got to stop lurching from crisis to crisis, in his words and in our words.

KWAME HOLMAN: Lawmakers now are making ready to leave for their five-week summer recess. For his part, Mr. Obama will continue his push on economic policy, next Tuesday, with a speech on homeownership in Phoenix.

Later, House Republican leaders withdrew a bill that would make sweeping cuts in transportation, housing and community development funding for the coming fiscal year. Conservatives had pushed the measure to meet lower spending levels spelled out in the House Republicans’ budget outline.

In Iraq, a wave of drive-by shootings and bombings across the country has killed at least 26 people. Several blasts targeted Shiite and Sunni mosques overnight in Baghdad. That followed bombings on Monday that killed 58 Iraqis. More than 700 people have died in the violence this month.

Civilian casualties in Afghanistan have risen sharply this year. The United Nations reported today they were up 23 percent in the first six months of the year. From January to June, the U.N. counted 1,319 civilian deaths and more than 2,500 wounded. It blamed Taliban insurgents for 74 percent of the casualties.

Secretary of State John Kerry arrived in Pakistan this evening for an unannounced visit. He’s to meet with newly elected Prime Minister Nawaz Sharif. The visit came as Pakistani police said they have recaptured more than 40 inmates who escaped from a prison Monday night. Taliban attackers had freed some 250 prisoners in all. The 35 guards on duty at the site were overwhelmed by 150 attackers who carried guns, bombs and grenades. Reports said only 10 of the guards were armed.

Thousands of people in Zimbabwe headed to the polls today to elect a new president and possibly end an era. Incumbent President Robert Mugabe was trying to keep his 33-year grip on power in the African nation.

We have a report from Neil Connery of Independent Television News.

NEIL CONNERY: First light, and in the chill of dawn, there is hope in the air.

The polls have just opened, and already the queues stretch out. Such is the hunger to make their voice heard, as Zimbabwe votes. Opposition candidate Ian Makone arrives to cast his ballot. He believes this could be the most significant day for this country since independence.

IAN MAKONE, opposition candidate: 1980 was a watershed election from colonial days, and this is a watershed election for freedom.

NEIL CONNERY: But as Zimbabwe’s only president since independence 33 years ago voted, he said the people had a choice to make and he has promised he will go if he loses. The man challenging him, opposition leader Morgan Tsvangirai is confident he has the support need to win.

MORGAN TSVANGIRAI, Zimbabwe presidential candidate: Well, I thought that it is not if; it’s when.

NEIL CONNERY: But with the voters register only issued yesterday, and widespread allegations of vote-rigging, critics doubt this can be judged a free and fair election.

But, despite those fears, across Zimbabwe, wherever we traveled, the determination to vote was clear.

The large turnout in this election could prove crucial. The opposition fear this ballot is going to be fixed. But they say that their ability to counter that increases with the number of voters who turn out.

As Zimbabweans consider this country’s future, they hope their vote will count.

MAN: I’m so much — I’m happy because we have done everything so peacefully and everything is moving so smoothly.

MAN: I feel happy to vote today. We choose a president.

NEIL CONNERY: But will that choice be respected? If not, then the consequences for this nation could be devastating.

KWAME HOLMAN: Zimbabwe was rocked by violence in 2008, amid charges Mugabe had stolen that election. He and Tsvangirai eventually agreed to share power in a unity government.

Those are some of the day’s major stories.