FED ZEROING IN ON INFLATION

Federal Reserve Chairman Alan Greenspan said Tuesday that inflationary pressures are unacceptable and that the central bank would continue fighting higher prices by driving up interest rates. Greenspan's remarks could spell bad news for the Bush administration, which is counting on robust economic growth to reduce the federal budget deficit without the need to increase taxes. Greenspan released an economic forecast prepared by the central bank that showed growth significantly lower than the Bush administration's estimate. The central bank has been pushing interest rates higher in an effort to restrain domestic demand since March of last year, an effort that has sent a variety of short-term interest rates climbing by about 3 percentage points. In his testimony, Greenspan discussed this effort and said the central bank "remains more inclined to act in the direction of restraint" on the supply of credit.