BANKING & FINANCE - March 8, 1994

Fed Governor Sees Stable Short-Term Rates: U.S. short-term interest rates will probably remain near 3% this year, Federal Reserve Board Gov. Lawrence Lindsey said. His remarks implied that the Fed may not push short-term interest rates sharply higher this year. On Feb. 4, Fed Chairman Alan Greenspan announced the board was boosting short-term rates on loans among banks to head off inflation. The so-called federal funds rate rose to 3.75% from 3%. Lindsey told a Baltimore meeting of the Commercial Finance Assn. that he concurs with forecasts that the U.S. output of goods and services, retail price hikes and short-term rates will all be about 3% this year.