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Honda exec.: Federal Reserve should cut interest rates to help economy

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ROCHESTER, Mich. (AP) _ Honda Motor Co.'s top U.S. executive said Friday he would like to see the U.S. Federal Reserve cut interest rates further to keep the American economy going.

John Mendel, executive vice-president of automobile operations, also predicted that the U.S. auto market will stabilize around 16 million vehicles sold this year because of government and other actions to shore up the troubled housing industry.

``The economy is not in horrible shape,'' he told a small group of reporters at a technology event for Acura, the automaker's luxury brand, in suburban Detroit. ``I mean, the world is not falling apart.''

Federal Reserve policymakers meeting in early August acknowledged they might have to take action to ease a growing credit crunch. A cut in one interest rate came 10 days later on Aug. 17, and analysts are expecting a broader rate cut when Chairman Ben Bernanke and his Fed colleagues meet in September.

Automotive forecasting company CSM Worldwide has forecast U.S. sales will total 16.2 million in 2007, or 350,000 fewer vehicles than last year. That would be the lowest annual sales level since 1998 and more than one million vehicles lower than the peak of 17.3 million in 2000, according to Ward's AutoInfoBank.

Mendel said Honda would stick to its projection of about three per cent U.S. sales growth this year because it is expecting a sales boost from its new Accord, which is expected to go on sale in mid-September.

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Honda exec.: Federal Reserve should cut interest rates to help economy
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